Strategy for Improving Maintenance and Reliability

IMC-2005

Dave Schrader, CMRP

COPYRIGHT © 2005, FLUOR CORPORATION. Michael Eisenbise, PE, CMRP, CPE
ALL RIGHTS RESERVED.
CONFIDENTIAL
Note,

The slides that are saved to the IMC-2005 CD presentation

CD are extensive. The slides presented at IMC-2005 are
selected key slides from this presentation.
Fluor is providing these slides to you because they contain
additional information that can be used to improve
maintenance and reliability at your plant
If you care to have an exact copy of the slide presentation
given at IMC-2005 contact one of the Fluor personnel listed
at the end of this presentation.

1
Presenters

Dave Schrader Michael Eisenbise

2
Introduction

‹Name Dave Schrader, CMRP

‹Role Director Operations & Maintenance
‹Background
– BSME Rose Hulman Institute of Technology
– Certified Maintenance and Reliability Professional
– Experience
• 30 Years in operations & maintenance
• Manufacturing
• Steel - Hot Rolling, Cold Rolling & Finishing
• Aluminum - Smelting,Casting, Hot Rolling & Cold Rolling
• Copper - Smelting
• Electronics

3
Introduction

‹Name Michael Eisenbise PE, CMRP, CPE

‹Role Director Operations & Maintenance
‹Background
– BSME/MSME Tennessee Technology University
– Certified Maintenance and Reliability Professional
– Certified Plant Engineer
– Experience
• 30 Years in operations & maintenance
• Chemical
• Pulp and Paper
• Artificial Fibers
• Electronics

4
Basic Steps for Improving Maintenance

1. Evaluate existing maintenance programs

2. Identify gaps between existing practices and best-of-the-best
maintenance practices
3. Develop a plan to close the gaps
4. Develop the business case to support your plans to close
gaps
5. Obtain management support for closing the gaps
6. Develop improvement plan
7. Develop applicable metrics
8. Measure success of improvement plan
9. Pursue continuous improvement

5
Evaluate Existing Maintenance Programs

‹Maintenance must be improved in stages.

‹Itis important to determine the maturity of your

existing maintenance effort.

‹A common mistake is to attempt to deploy an

advanced maintenance/reliability programs prior to
deploying basic maintenance/reliability programs.

6
Stages of Maintenance and Reliability

Stage 4
Best of the Best
Maintenance
Stage 3 Program
Reliability
Centered
Maintenance
Stage 2 Program
Advanced
Maintenance
Program
Stage 1
Basic Preventive
Maintenance
Program

7
 Stage 1 - Basic Preventive Maintenance

Lubrication and
Work Initiation and Planning and
Lubrication Training
Prioritization Scheduling

Management
and Control of Computerized
Financial Performance, and Work Equipment
Maintenance History
Management Processes Management System

Materials
Preventive Work Execution, Work
Management, Inventory
Maintenance Review and Craft
Optimization and Supplier
Productivity
Management

8
Determining Status of Your Maintenance and
Reliability Programs

As the presenter discusses each maintenance

program element, number each block as follows:
1. Program element is either non-existent or procedures
not formalized or communicated to employees. Few
employees understand what they must do on a day-
to-day basis to support this element of our program.
2. Neither 1 nor 3
3. Excellent program element in place and program is
mature. Procedures to manage program are well
documented. Everyone understands what they must
do on a day-to-day basis to support this element of
our program. Key performance indicators
(maintenance metrics) are in place.

9
Determining Status of Your
Maintenance and Reliability Programs

‹As you evaluate your maintenance and reliability programs

consider everything that you are responsible for
maintaining.
‹Often non-rotating equipment, building maintenance etc. is
overlooked.
‹As we discuss each criteria for evaluating your programs,
keep in mind how much value is offered your company by
implementing each of the programs listed.
‹The criteria listed is not all inclusive. There is sufficient
criteria listed to give you a good idea of the maturity of your
maintenance and reliability programs.

10
Lubrication and Lubrication Training

‹Lubrication surveys and manufacturer recommendations have

been used to establish lubricant requirements, points of
lubrication, and frequencies for all lubrication points.
‹Lubricatingactivities occur on a scheduled basis and are
given necessary priority to ensure that they are completed as
scheduled.
‹There is a central storage facility for all plant lubricants. The
area is clean. All lubricants are protected from contamination
from the time they arrive at the storage facility until they are
used. All lubricant storage containers are well labeled.
‹Lubricants have been standardized and a minimum number of
lubricants are used on site. A typical plant uses a total of 5 to
10 lubricants.

11
Lubrication and Lubrication Training

‹Personnel responsible for lubrication are trained in the proper

application of lubricants and understand the possible
significance of changes in lubricants and amounts required.
‹A skilled, experienced, mechanical technician has been
selected as the lubricator. The technician can easily detect
pending equipment failures while lubricating the equipment
and often determines the failure mode.
‹The total number of failures due to lubrication are minimal.
The failures attributed to lubrication can be easily determined
and corrected.
‹Lubricantsuppliers have been consolidated to one primary
and one secondary supplier. All lubricants are sampled and
analyzed when received from the supplier.

12
Lubrication and Lubrication Training

Score yourself on your

existing Lubrication and
Lubrication Training Program

13
 Work Initiation and Prioritization

‹Non-emergency work is initiated by a work request, aka work

notification in SAP.
‹All
work requests, notifications, are entered directly into the
CMMS.
‹Work requests, notifications, are turned into work orders by
the planner/scheduler.
‹Emergency work is performed without a work request or work
order. A work order is generated (often after the fact) to
capture all costs associated with emergency work. All
emergency work is charged to a work order.
‹Allnon-emergency work is prioritized by the maintenance
planner and scheduler and a production representative a
minimum of one week prior to the execution of the work.

14
Work Initiation and Prioritization

Score yourself on your

existing Work Initiation and
Prioritization Program

15
Planning and Scheduling

‹Job plans or work packages are developed for the majority of

maintenance work.
‹Job plans include, location of parts, what needs to be done,
lock-out-tag out requirements, confined space entry
requirements, list of consumables, list of parts required,
special instructions, special tools, etc.
‹Job plans include skill requirement's to successfully complete
the task(s), special tools needed to complete the tasks and
special equipment that may be required.
‹Scheduling includes monitoring the maintenance backlog.
‹Scheduling includes coordinating downtime with production to
minimize downtime of critical equipment.

16
Planning and Scheduling

‹Job plans or work packages include safety precautions,

information regarding permits, and incorporate safe work
practices in the work description.
‹The need for planning maintenance work is recognized and
the activities are formally assigned within the maintenance
organization.
‹Maintenance backlogs are reviewed at least monthly to
purge work orders that may no longer be required.
‹Dailyschedules of maintenance work are developed for
each shop or work group.
‹Schedulingincludes plans to have production shut the
equipment down and have it ready to be repaired.

17
Planning and Scheduling

Score yourself on your

existing Planning and
Scheduling Program

18
Management and Control of Financial
Performance and Work Management
Processes
‹Expense budgets are built from a zero base.
‹Each work group is responsible for building its budget,
obtaining approval, and stewarding expense against the
budget.
‹Development of cost awareness in work groups is
understood to be a key management responsibility.
‹Variances from budget or plan are tracked and analyzed.
‹Corrective action is taken to correct negative financial trends.
‹The cost reporting system is on line providing up-to-date
information and is integrated with other related functions,
e.g., maintenance and materials.

19
Management and Control of Financial
Performance and Work Management
Processes
‹Responsibility
and accountability for maintenance cost
performance at all levels is well defined and understood.
‹Labor charges to work orders reflect the actual time
required to perform the work.
‹For each work request an estimate of labor and material
costs is generated and is used as input to the evaluation
and approval process.
‹Approved work orders require further review and
endorsement in advance if preset expenditure limits will be
exceeded.

20
Management and Control of Financial
Performance and Work Management
Processes
‹ Work schedule reports are tailored to the users and provide
information necessary to effectively coordinate the work.
‹ The CMMS is the management tool for maintenance work
order activities, storeroom transactions, maintenance cost,
equipment history, and equipment reliability. Special software
is frequently linked to provide specific information or analysis
ability.
‹ Workorder history provides for the recording of the condition
found, the work performed, and the as completed status.
‹ Equipment is listed on an asset register and numbered in a
hierarchical array to suit the requirements of the business.
‹ Each equipment item has a file in a hierarchical database
within the CMMS.

21
Management and Control of Financial
Performance and Work Management
Processes

Score yourself on your existing

Management and Control
of Financial Performance
and Work Management
Programs

22
Computerized Maintenance
Management System (CMMS)

‹A CMMS is in active use to manage the maintenance work

control process, MRO parts and material, equipment cost,
and history.
‹The CMMS is built around an equipment listing that
identifies every unique equipment item.
‹Allwork orders are linked to a specific equipment item and
tracked by that equipment identification through the CMMS.
‹A record of actual work done is documented in the CMMS
equipment record.
‹Alllabor, material, and contractor costs are charged to
specific equipment items.

23
Computerized Maintenance
Management System (CMMS)

‹ A standard process exists for naming conventions,

abbreviations, and record structures.
‹ The equipment record is the repository for all data,
specifications, and maintenance activity for that
equipment.
‹ All parts, maintenance supplies, and tools are managed
by the storeroom and accounted for within the CMMS.
‹ Repairable components and assemblies are managed by
the storeroom and tracked within the CMMS.
‹ Lubrication, preventive, and PdM activities are controlled
in and originated from a CMMS.

24
Computerized Maintenance
Management System (CMMS)
‹ The status of work orders can be tracked electronically by all
relevant personnel such as the originator, maintenance staff,
materials support staff, production staff, etc.
‹ Theinformation database is coupled to other integrated
functions. For example, parts can be ordered from an
equipment drawing using point and click technology.
‹ Themaster file is controlled to assure that the information is
accurate. Information requirements are specified in purchase
contracts e.g. operating manuals required in standard format
and drawings on a CAD system.
‹A documented process is in place to control changes made to
information in the CMMS. For example, when equipment is
added or removed from service, the appropriate CMMS records
are updated.

25
Computerized Maintenance
Management System (CMMS)

Score yourself on your

existing Computerized
Maintenance Management
System (CMMS) Program

26
Equipment History

‹A technical library exists and is the repository of a master

file of technical information, drawings, and documents.
‹Manufacturer’s documentation for new equipment are
obtained as part of the equipment purchase and is available
in time to develop operating and maintenance procedures in
advance of equipment operation.
‹Equipment-related technical information, drawings, and
documentation can be easily located through the equipment
number or identification.
‹A procedure to access, update, protect, and control
materials in the technical library is documented, published,
understood, and followed.
‹Drawings are maintained in an as-built status.

27
Equipment History

‹Access to the equipment history is controlled such that

information is not removed or added to the library without
following the appropriate procedures.
‹Ideallyan equipment history is stored in an electronic
format that can easily be accessed by the appropriate
personnel.
‹Maintenance requests are reviewed for history retention
applicability, and data is entered in the maintenance history
program.
‹Procedures clearly define the type of history to be collected
and recorded. Accountabilities for data entry are also
clearly specified.

28
Equipment History

‹Data included or cross-referenced in equipment history

include:
– Corrective maintenance records with failure modes and
causes included
– Appropriate preventive and PdM records and design
modification packages
– As found condition during corrective and PM
– Vendor repair information (for example, correspondence on
component repairs and modification bulletins)
– Start-up tests and other baseline data
– Appropriate surveillance test data
– Calibration data
– Spare parts information
– Applicable industry experience information

29
Existing Equipment History

Score yourself on your

existing Equipment History
Program

30
Materials Management, Inventory
Optimization, and Supplier Management
‹An identification system is in place that defines inventory and
repair part data associated with capital spares, long delivery
spares, and one-of-a-kind or critical insurance spares.
‹There is a concerted management effort to reduce on-site
inventory to a minimum level.
‹Maximum use of vendor stocking, pay on use, and just-in-
time delivery methods is pursued.
‹A computerized management system is in place to control
order points, order quantities, and inventory levels.
‹Spare parts are linked to specific equipment and a complete
listing of spare parts for any equipment item is readily
available.
‹Obsolete spare parts are routinely identified and purged from
inventory.

31
Materials Management, Inventory
Optimization, and Supplier Management
‹ Inventory value is monitored routinely. Target maximum
levels have been established.
‹ Inventory turnover targets have been established and are
measured. An inventory turnover target is 4 (no ins.
spares).
‹ Adequate levels of spare parts, materials, and
maintenance supplies are on hand or readily available.
‹ Storeroom transactions are managed, controlled, and
accurately documented in a computerized management
system.
‹ A detailed inventory of parts and material is made at least
annually.
‹ Random cycle counts of parts and material are made at
least monthly.

32
Materials Management, Inventory
Optimization, and Supplier Management

‹ Access to the storeroom is managed and controlled.

‹ The storeroom is well lit, clean, and orderly.
‹ Where applicable, PM is performed on parts in the
storeroom. Example-shafts are turned on motors once per
month to prevent damage to the bearings.
‹ Storeroom requisitions for replacement of stock items
require the approval of only the storeroom manager to be
purchased.
‹ A process is in place to inspect, restock, return to
suppliers, or manage parts and materials that were issued
to a work order but were not used.
‹ Spare parts and components are acquired through
preferred suppliers.

33
Materials Management, Inventory
Optimization, and Supplier Management
‹ Vendor stocking, consignment stocking of parts and
materials, vendor consolidation are active initiatives to
reduce parts inventory levels.
‹ All purchase orders for parts are linked to the specific
maintenance work order that requires the part.
‹ A procedure is formally documented and followed that
separates the requestor, purchaser, and receiver of
procured parts and materials.
‹ Vendors are routinely monitored for quality of parts, lead
time, and price.
‹ Supplier management and partnering activities are pursued
to reduce overall materials cost and not focused on
individual purchase costs.
‹ Material and parts are “kitted” for the planned jobs, stored to
ensure availability, and identified by specific work order
number.

34
Materials Management, Inventory
Optimization, and Supplier Management
‹Supplier services such as lead time, delivery, warranty,
stocking, repair, obsolescence, product expertise, quality,
and invoicing are routinely discussed with suppliers to
ensure that needs and expectations are being met.
‹Two-tier supplier consortiums provide kits and deliver the
majority of requirements.
‹Economic order quantify algorithms are used to optimize
stock levels, minimizing holding costs, stock-out impacts,
and acquisition costs.
‹Localfree issue of commodity items promotes craft
productivity.
‹Parts and materials are delivered to the jobsite when
delivery provides an economic advantage.

35
Materials Management, Inventory
Optimization, and Supplier Management

Score yourself on your existing

Materials Management, Inventory
Optimization, and Supplier
Management Program

36
Preventive Maintenance

Definition of Preventive Maintenance

Scheduled or planned maintenance that is performed on a

set interval. The interval can be hours of run time, calendar
days, etc.

37
Preventive Maintenance

‹Regular,routine preventive maintenance activities are

completed on a scheduled basis.
‹Sources of leaks, drips, and spills are identified and cleaned
up immediately and their sources are eliminated or
corrected.
‹Craft workers performing the preventive maintenance
activities document the need for corrective maintenance
and continue with the inspection.
‹Work requests, or work notifications, are issued to correct
the problem after the inspections are completed.
‹A CMMS or equivalent computerized system supports the
scheduling and record keeping required of the preventive
maintenance activities.

38
Preventive Maintenance

‹ Preventive maintenance schedules are given the priority

required to comply with scheduled completion dates.
‹ Preventive maintenance compliance is measured on a
routine basis.
‹ Preventive maintenance compliance is consistently 98%.
‹ 3 out of 10 preventive maintenance inspection activities
detect defects.
‹ Deferrals of scheduled predictive and PM are infrequent
and are justified and authorized by designated
management.
‹ All participants in the preventive maintenance efforts are
properly and continually trained.

39
Preventive Maintenance

‹Actual conditions found and any changes or modifications

made are reviewed by supervision or reliability engineers to
determine if lubrication, preventive, or PdM activities or
their frequencies need to be changed.
‹Equipment that is required to be out-of-service for
preventive maintenance is lock-out / tagged-out by
production and is ready to be PM’d at the time of the
scheduled PM activity.

40
Preventive Maintenance

Score yourself on your

existing Preventive
Maintenance Program

41
Work Execution, Work Review and
Craft Productivity
‹Maintenance craft workers are provided with complete job
plans or work packages prior to beginning the work.
‹Craft workers are able to move from one job to the next
without delay and perform a full day’s work without
consultations with the supervisor because all necessary
information is communicated to them at the beginning of
the shift.
‹Maintenance technicians are not “pulled” off of planned and
scheduled jobs to perform emergency repair work.
‹Work schedules allow time to complete the work, clean up
the area, and participate in the startup to ensure that the
work was done properly.

42
Work Execution, Work Review and
Craft Productivity

‹The status of current day’s work is monitored so that the

next day’s work schedule may be adjusted for work
interruptions and unforeseen work changes.
‹The maintenance technician is expected to inspect his own
work to ensure that the work was completed correctly, the
area was cleaned up after work completed and the
equipment was successfully returned to service.
‹The maintenance supervisor randomly spot checks work to
ensure that it was performed correctly, area cleaned up
and rework is not required.
‹Wrench time, or touch time, is routinely measured or
calculated and it is consistently above 38% with a target of
50%.

43
Work Execution, Work Review and
Craft Productivity
Definition
Craft Productivity = Wrench time x Craft Performance x
Rework

Wrench time – Actual amount of time craftsman is

actually performing work.

Craft Performance – Total time planned for the job

compared to the total time required to complete the job.

Rework – 100% minus the percentage of time that

equipment has to be reworked.

44
Work Execution, Work Review and
Craft Productivity

Craft Productivity
‹Wrench time is consistently above 38% with a target of
50%
‹CraftPerformance is consistently above 85% with a target
of 100%
‹Rework is consistently below 2% with a target of 0%

45
Work Execution, Work Review and
Craft Productivity

Score yourself on your existing

Work Execution, Work Review
and Craft Productivity Program

46
Stage 1 - Basic Preventive Maintenance

‹Lubrication and Lubrication Training

‹Work Initiation and Prioritization
‹Planning and Scheduling
‹Management and Control of Financial Performance, and
Work Management Processes
‹Computerized Maintenance Management System
‹Equipment History
‹MaterialsManagement, Inventory Optimization and
Supplier Management
‹Preventive Maintenance
‹Work Execution, Work Review and Craft Productivity

47
Stage 1 - Basic Preventive Maintenance

What is your overall accumulative average?

1.0 to 1.5 Reactive Maintenance

1.5 to 2.5 Developing Stage 1
2.5 to 3.0 Stage 1

48
Stage 2 - Advanced Maintenance

‹Maintenance Shop Tools and Equipment Enhancement

‹Craft Skills Enhancement

‹Assessment, Screening, and Hiring of Personnel

‹Condition Monitoring (PdM) and Failure Prediction

‹Craft Flexibility

49
Maintenance Shop Tools and Equipment
Enhancement
‹Facilities, tools, and equipment are adequate to effectively
support maintenance activities.
‹Suitable storage is provided for tools, supplies, and
equipment. Special tools, jigs, and fixtures are identified
and stored to permit ready retrieval.
‹Rigging equipment and scaffolding is identified, tested, and
properly stored.
‹Facilities, equipment, and tools are maintained in good
repair.
‹Measuring and test equipment is calibrated and controlled
to provide accuracy and traceability.
‹Written policies and procedures address the
responsibilities of the company and employees for
supplying, controlling, securing, and replacing tools.

50
Maintenance Shop Tools and Equipment
Enhancement

‹There are written procedures and facilities for the security

and tracking of major tools.
‹Tool and equipment needs are prescheduled and planned
to be available in kits for specific work orders.
‹Periodic safety inspections include hand tool checks for
condition and safety.
‹Shop equipment and tools capacity and utilization is
optimal to support plant availability goals.
‹A readily accessible supply of personal protective
equipment, such as various types of work gloves, eye and
hearing protection, and fall protection devices, such as
harnesses, is provided.

51
Maintenance Shop Tools and Equipment
Enhancement

‹Where appropriate multiple equipment shops are located

throughout the facility.
‹5S’s have been applied to each shop area to ensure that
the optimum amount of shop equipment and tools are
available and located or stored in an appropriate location.
‹The shop equipment is maintained properly.

52
5S’s Defined
Sort
– Clearlydistinguish the items needed in a work area from those no
longer needed. Red tagging is the activity that eliminates these
un-needed items.
Set in order
– Keeping
the needed items in the correct place to allow for easy
and immediate retrieval.
Shine
– Keeping work areas, all work surfaces and equipment clean and
free from dirt, debris, oil, etc.
Standardize
– Standardize activities, procedures, schedules and the persons
responsible for helping keep the workplace clean and organized.
Sustain
– Drivethe organization to be disciplined in maintaining these new
standards and procedures and in continuously improving the state
of the workplace.

53
Maintenance Shop Tools and Equipment
Enhancement
‹There is adequate shop space to perform repair and
service work away from the operating environment.
‹Operating equipment and building layout provide adequate
space for repair and service work that must be performed
at the equipment location.
‹There is adequate, controlled nearby storage for tools,
equipment, and frequently used parts and supplies.
‹There is sufficient controlled outside lay-down space for
temporary storage and fabrication during major installation
and repair activities
‹Craftworkers use the proper hand tools for the task.
Example: No adjustable pliers or adjustable open end
wrenches on site.

54
Maintenance Shop Tools and Equipment
Enhancement

Score yourself on your existing

Maintenance Shop Tools and
Equipment Enhancement
Program

55
Craft Skills Enhancement

‹Effectivetraining is keyed to plant-specific needs and must

be integrated into an overall performance improvement
process.
‹A comprehensive analysis has been accomplished to
define all knowledge and skill requirements for the
maintaining and operating functions.
‹Criticaltraining requirements have been identified,
especially training involving high-cost equipment and the
most frequently recurring tasks that affect downtime.
‹Alltraining programs and materials are designed and
developed to be plant/process-specific and are keyed to
clearly define job knowledge and skill requirements.

56
Craft Skills Enhancement

‹The program design facilitates use of material for

classroom or self-paced (self-study) application.
‹Training programs make optimum use of classroom,
vendor, self-study, and structured hands-on training.
‹Specifications for training related to new equipment items
are clearly defined in procurement documents.
‹Performance, or competency-based training materials,
reflect sound instructional design and adult learning
principles, are keyed to instructional objectives, provide the
appropriate level of detail, and are validated by qualified
content experts.

57
Craft Skills Enhancement

‹On-the-job performance qualifications are used to evaluate,

certify, and document employee skills. Written tests are
used, when appropriate
‹Adequate facilities and equipment are available to support
classroom, laboratory, and on-the-job training.
‹A formal evaluation process and instruments are in place to
facilitate feedback from trainees, trainers, and plant
supervision.
‹Training personnel work closely with plant personnel to
establish criteria and selection processes for plant
personnel.
‹Training programs systematically address changes in
configurations and procedures, regulatory requirements,
and applicable lessons learned from industry and in-house
operating experiences.

58
Craft Skills Enhancement

Score yourself on your

existing Craft Skills
Enhancement Programs

59
Assessment, Screening and Hiring of
Personnel
‹ Economic trade-offs between hiring personnel of proven skills
and providing training necessary to acquire the skills are
analyzed as appropriate.
‹ Systems to track the experience and qualifications of in-house
maintenance personnel and contractors are in place.
‹ Vendor and local training agency programs have been
carefully evaluated to ensure that they support plant-specific
needs.
‹ Maintenance managers ascertain that plant staffing and
resources are sufficient, including that maintenance personnel
have requisite knowledge, skill, proficiency, and familiarity with
the operations of the plant(s).
‹ A basic mechanical aptitude test is part of the assessment
program.

60
Assessment, Screening and Hiring of
Personnel

Score yourself on your

existing Assessment,
Screening and Hiring of
Personnel Program

61
Condition Monitoring (PdM) and
Failure Prediction
Predictive Maintenance (PdM)

‹PredictiveMaintenance uses technology to focus on

detecting wear and the onset of failure of parts and
components in such a way that repair may be made on a
planned and scheduled basis.
‹Predictive Maintenance activities should replace Preventive
Maintenance activities wherever possible and are cost
effective to do so.

62
Condition Monitoring (PdM) and
Failure Prediction
‹ Regular, routine predictive maintenance activities are
completed on a scheduled basis.
‹ Predictive maintenance activities have been established
based on a process to identify critical equipment, common
modes of failure, and primary indicators of failure.
‹ New baseline performance measurements are
documented whenever equipment has been repaired.
‹ Critical, new equipment is installed with in-line, continuous
monitoring and diagnostic devices.
‹ Actual repair findings are compared with predicted
condition to validate and upgrade the diagnostic
applications.

63
Condition Monitoring (PdM) and
Failure Prediction
‹PredictiveMaintenance results are continually tracked and
evaluated to ensure proper application.
‹PM activities are replaced with PdM activities.
‹PdM and PM are performed on equipment and spare parts
to improve equipment performance.
‹The frequency and type of predictive and PM are adjusted
based on operating experience, results of reliability
analyses, changes in operating conditions and
environment, and vendor recommendations.
‹Maintenance history is analyzed to determine equipment
failure trends attributed to aging.

64
Condition Monitoring (PdM) and
Failure Prediction
‹Correctiveactions are taken before condition specifications
are exceeded.
‹Systems and methodologies for inspection are developed
by a group of experts to ensure the inspection plan is
comprehensive.
‹Inspection routines are in place to assess condition of
critical equipment. The routines are regularly audited and
reviewed for quality and follow-up by management.
‹New baseline performance measurements are documented
whenever equipment has been repaired.
‹Maximum use of see-through panels, inspection ports, and
other visual indicators is used.

65
Condition Monitoring (PdM) and
Failure Prediction
‹Regular,routine, PdM activities occur on a scheduled
basis. PdM monitoring is given priority for scheduling
purposes and is executed on a timely basis.
‹Wherever nonstandard conditions or potential failures are
detected, a work request is initiated to correct the fault.
‹A database is established for each predictive indicator on
each equipment item. A complete and accurate equipment
history is maintained and is easily accessible for analysis.
‹Statisticalanalysis techniques are used to monitor trends.
Alert and danger limits are identified.

66
Condition Monitoring (PdM) and
Failure Prediction

Score yourself on your

existing Condition Monitoring
(PdM) and Failure Prediction
Program

67
Craft Flexibility

‹Technicians perform tasks in maintenance disciplines other

than their primary discipline. Example - A mechanic might
disconnect the wiring to a motor once the motor has been
properly locked-out and tagged-out. An electrician might
remove an access panel that normally requires a
mechanical technician to remove.
‹For technicians that are represented by a Union, the Union
contract specifically allows technicians to work outside of
their traditional craft.
‹Some activities that are traditionally performed by
maintenance craftsmen are performed by maintenance
helpers or operators.

68
Craft Flexibility

Score yourself on your

existing Craft Flexibility
Program

69
Stage 2 - Advanced Maintenance

‹MaintenanceShop Tools and Equipment

Enhancement
‹Craft Skills Enhancement
‹Assessment, Screening and Hiring of Personnel
‹Condition Monitoring (PdM) and Failure Prediction
‹Craft Flexibility

70
Stage 2 - Advanced Maintenance

What is your overall accumulative average?

1.0 to 1.5 Not in Stage 2

1.5 to 2.5 Developing Stage 2
2.5 to 3.0 Stage 2

71
Stage 3 - Reliability Centered Maintenance

‹Small Capital Project – Maintenance Pre-Planning

‹Shutdown (Outage/Turn Around) Management
‹Contractor Management
‹External Versus Internal Benchmarking
‹Root Cause Failure Analysis (RCFA or RCA)
‹Reliability Centered Maintenance (RCM)
‹TPM, Operator Performed Maintenance and Overall
Equipment Effectiveness (OEE)

72
Small Capital Project – Maintenance
Pre-Planning
‹ A change management process is in place to ensure
product and process quality when modifications,
additions, and alterations are considered.
‹ Responsibility and accountability for individual projects
are assigned and understood.
‹ System walk downs are made; punch lists are developed,
prioritized, and completed as part of the turnover process.
‹ A commissioning plan and schedule is developed to
sequence the engineering effort.
‹ Built-in condition monitoring and self-diagnostics are part
of the standards and specifications when applicable.
‹ Maintenance resources participate in all phases of a
capital project.

73
Small Capital Project – Maintenance
Pre-Planning

‹As-built documentation records are maintained and made

part of the turnover package.
‹Allvendor prints, operations and maintenance (O&M)
manuals, spare part lists, etc. are turned over to operations
and maintenance in sufficient time for development of the
O&M support functions.
‹Engineering specifications and standards effectively
address operability and maintainability (including
accessibility, ease of surveillance, cleanliness, modularity),
documentation (operation, maintenance, reliability), spare
parts, in line spares of redundancy, lead times, stock
quantities, pricing discounts, training, and use of
acceptance tests for predictive base lining.

74
Small Capital Project – Maintenance
Pre-Planning

‹Allmaintenance procedures such as PM plans, PdM plans,

lubrication plans, and calibrations have been identified,
written, and are inputted into the CMMS system before
operation.
‹A process is in place to eliminate or mitigate the
consequences of sub-standard reliability and equipment
performance.

75
Small Capital Project – Maintenance
Pre-Planning

Score yourself on your

existing Small Capital Project
– Maintenance
Pre-Planning Program

76
Shutdown (Outage/Turn Around Management)

‹Each work request is planned in detail for material, labor –

number and skill, tools, support requirements, and cost.
‹Each work request is analyzed to determine whether it must
be performed before, during, or after the actual downtime.
‹Pre-shutdown inspections and diagnostics are utilized to help
define work content and parts requirements.
‹A computerized critical path shutdown process is used to
control all activities, details, and schedules.
‹Material and parts are “kitted” for the planned jobs, stored to
ensure availability, and identified by specific work order
number.
‹All “long lead time” purchased materials are tracked and
expedited.

77
Shutdown (Outage/Turn Around Management)

‹ A shutdown manager is assigned for each major

shutdown or outage.
‹ All shutdown procedures requiring blinding, blocking,
purging, isolation, lockout, and tagging are developed and
reviewed with the safety and environmental resources.
‹ After completion and startup, a formal shutdown review is
conducted to identify process improvements to be
included in the next shutdown.

78
Shutdown (Outage/Turn Around Management)

Score yourself on your

existing Shutdown
(Outage/Turn Around
Management) Program

79
Contractor Management

‹ Written plant policies exist that define those jobs and

activities that may be contracted.
‹ Core skills to be maintained in-plant have been defined.
‹ Plant procedures exist that address the use of contractors
and specify the required management, control, and tracking
process that must be followed for each contract.
‹ The use of contractors for maintenance is tracked and
evaluated for cost and performance on a routine basis.
‹ A rigid qualifying process is followed for contractors that
includes past work performed, financial and other resources,
safety and cost control experience, quality of supervision,
etc.
‹ Accountability and responsibility for contractor performance
is specified communicated, and understood.

80
Contractor Management

‹ Plant contracting guidelines encourage the development of

alliances and long-term relationships with major contractors
and suppliers.
‹ Formal evaluations of contractor performance are
conducted and become part of the contractor qualification
process.
‹ The contractor has a maintenance focus and organization.
‹ The contractor has capability to provide reliability consulting
services if necessary.
‹ All contracted work is planned and scheduled.
‹ Non-departmental and contract personnel perform
maintenance under the same controls as, and to the same
high work standards expected of, maintenance personnel.

81
Contractor Management

Score yourself on your existing

Contractor Management
Program

82
External Versus Internal Benchmarking

‹External benchmarking is utilized to compare performance

to the performance of the best-of-the-best competitors.
‹Craft productivity is monitored and compared with similar
size/age units.
‹Appropriate metrics are in place to measure the
effectiveness of the planning/scheduling process. Internal
and external benchmarking is periodically performed.
‹Competitive bidding and benchmarking are used as
necessary to assure competitive pricing, quality, etc.

83
External Versus Internal Benchmarking

Score yourself on your

existing External Versus
Internal Benchmarking
Program

84
Root Cause Failure Analysis (RCFA or RCA)

‹ Root cause failure analysis is a standard procedure for

critical equipment failures.
‹ Resources are identified to investigate failures and have
been trained in failure analysis techniques.
‹ Failure analysis findings are the basis for changes to the
lubrication, preventive and predictive maintenance
activities and frequencies.
‹ Repetitive equipment failures are promptly identified and
systematically pursued to resolution. Note: Most often
overlooked in a RCFA program.
‹ Action items to mitigate the recurrence of a failure are
developed, assigned to an individual to complete, and
completed in a timely manner.

85
Root Cause Failure Analysis (RCFA or RCA)

‹Evidence used in the RCFA is gathered prior to any repairs

or corrective actions.
‹Failures that require an RCFA are identified and appropriate
triggers are in place and communicated to all appropriate
personnel.
‹A procedure for performing RCFA’s is in place,
communicated to the appropriate personnel and supported
by management.
‹An RCFA champion has been identified and ensures that
the RCFA process is being followed and is constantly being
improved.
‹The number of failures that require an RCFA are tracked
and decreasing over time.

86
Root Cause Failure Analysis (RCFA or RCA)

Score yourself on your

existing Root Cause Failure
Analysis (RCFA or RCA)
Program

87
Reliability Centered Maintenance (RCM)

‹For complex maintenance applications the Reliability

Centered Maintenance (RCM) process is used to
determine the optimum, cost-justified maintenance plan or
basis for any physical asset based on its operating context
and a common understanding of its function, modes of
failure, and value to the business.
‹For less critical equipment applications a more informal
basis setting process may be used.
‹ Equipment criticality is established by a formal process
that documents the methodology and the results of the
analysis.
‹Monitoring, inspecting, servicing, and testing activities and
frequencies is established based on the results of the
analysis and will focus on the most critical equipment.

88
Reliability Centered Maintenance (RCM)

‹A system is in place to analyze the performance of all

equipment (proposed or installed) to determine failure
modes and failure effects.
‹The output from the RCM is shared with the
designer/manufacturer to enable elimination of failure
modes and facilitate improvement in equipment design.
‹A person(s) assigned as the RCM facilitator has been
trained to perform the RCM analyses.
‹The maintenance plan, one time engineering
recommendations, etc. developed in the RCM analysis are
implemented.
‹On a regular basis the maintenance strategy developed in
the RCM analysis is reviewed to ensure that the
maintenance strategy has improved the reliability of the
equipment and is cost effective.

89
Reliability Centered Maintenance (RCM)

Score yourself on your

existing Reliability Centered
Maintenance (RCM)
Program

90
TPM, Operator Performed Maintenance,
and OEE
Total Productive Maintenance (TPM) involves the
following:
‹Maintenance Prevention in the design and selection of new
equipment.
‹Predictive maintenance to determine the life expectancy of
components.
‹Corrective maintenance to improve equipment
performance.
‹Preventive maintenance on a scheduled basis to ensure
the continuous smooth operation of equipment.
‹Autonomous maintenance to involve production employees
in the total machine maintenance process. Autonomous
maintenance is operator performed maintenance.

91
TPM, Operator Performed Maintenance,
and OEE

Overall Equipment Effectiveness (OEE)

OEE = Run Rate% x Availability% x Yield%
Run Rate% = Rate at which the equipment is
producing a product compared to the maximum rate
at which the product can be produced.
Availability% = Percentage of time that the
equipment is available to run.
Yield% = Percentage of first quality product that is
produced by the equipment and does not have to
be reworked or sold as a second off specification
product.

92
TPM, Operator Performed Maintenance,
and OEE

‹The OEE of equipment is calculated on a regular basis and

benchmarked with the OEE of other companies.
‹Data that impacts OEE is captured and analyzed to
determine the reasons for production losses and to reduce
failures that impact OEE.
‹OEE measurements are first applied to equipment that
bottlenecks the process.
‹OEE is measured in real time. Impact to OEE is corrected
as soon as the impact is observed.
‹OEE is understood by management, operation, and
maintenance employees.

93
TPM, Operator Performed Maintenance,
and OEE

‹Operators perform maintenance to the extent appropriate.

‹Area operators participate in the shutdown and start-up of
the equipment and assist with repairs whenever possible.
‹Production employees are trained to perform equipment
inspections, lubrication, and minor mechanical repairs.
‹As appropriate and during equipment or plant downtime,
operators assist maintenance with repairs.
‹A formalized TPM program is in place.

94
TPM, Operator Performed Maintenance,
and OEE

Score yourself on your

existing TPM, Operator
Performed Maintenance, and
OEE Program

95
Stage 3 - Reliability Centered Maintenance

‹Small Capital Project – Maintenance Pre-Planning

‹Shutdown (Outage/Turn Around) Management
‹Contractor Management
‹External Versus Internal Benchmarking
‹Root Cause Failure Analysis (RCFA or RCA)
‹Reliability Centered Maintenance (RCM)
‹TPM, Operator Performed Maintenance, and Overall
Equipment Effectiveness (OEE)

96
Stage 3 - Reliability Centered Maintenance

What is your overall accumulative average?

1.0 to 1.5 Not in Stage 3

1.5 to 2.5 Developing Stage 3
2.5 to 3.0 Stage 3

97
Stage 4 – Best-of-the-Best Maintenance

‹Reliability Performance and Data Management

‹Systematic Failure Elimination
‹Equipment Simplification and Standardization
‹Engineering Life Cycle Cost Analysis
‹Operability and Maintainability Analysis

98
Reliability Performance and Data
Management
‹ Yield is improved using these commonly accepted best practices:
– Quantifying losses by reason
– Prioritizing with Paretos
– Allocating historical losses to root causes
– RCFA
– Anticipating losses with FMEAs
‹ A central database exists for appropriate predictive indicators and is
consistently used to improve equipment reliability.
‹ A measurement system is in place that records, codes, describes,
stores and allows retrieval and analysis of all process delays and
losses.
‹ The measurement systems that support the maintenance function
are effective, automated (e.g. single data entry automatically or
manually), flexible and facilitate the communication process.

99
Reliability Performance and Data
Management

‹Systematic validation processes are in place to ensure the

integrity of the data.
‹Informationsystems are in place to summarize, trend, and
analyze equipment failures and downtime.
‹Equipment deficiencies are identified early to avoid further
degradation and to support resolution using routine or
simple corrective actions.
‹Actual conditions or failures found or any changes or
modifications made are reviewed to determine if the
lubrication, preventive, or PdM activities or their
frequencies need to be changed. These changes are input
into the CMMS system.

100
Reliability Performance and Data
Management

Score yourself on your

existing Reliability
Performance and Data
Management Program

101
Systematic Failure Elimination (SFE)

‹A performance management system that promotes a

systematic approach to eliminating failures has been
established.
‹Critical success factors for deploying an SFE program have
been identified.
‹Leadership involves representatives from all levels of the
organization in the SFE program.
‹A goal for reducing failures is established. Each employee
contributes to obtaining this failure reduction goal. A
quantifiable measurement to track the employees
contribution to failure elimination is established.
‹Variance analysis, statistical analysis and Root Cause
Analysis are used as techniques to detect significant failures,
determine their underlying causes, and establish appropriate
corrective and preventative actions to meet or exceed
business goals.

102
Systematic Failure Elimination (SFE)

‹A system is in place to prioritize action plans to close

identified Gaps
‹Completion and closure of action plans are tracked.
‹Continuous improvement is quantified and tracked.

103
Systematic Failure Elimination (SFE)

Score yourself on your

existing Systematic Failure
Elimination (SFE) Program

104
Equipment Simplification and Standardization

‹A program is in place to minimize the quantity of unique

types of materials and equipment. This includes a review of
the design of new equipment and purchases to identify
standardization opportunities.
‹Equipment standardization is included in the scope of any
new project.
‹Equipment standardization is pursued on a plant-wide
basis and a company-wide basis.
‹A program is in place that requires approval to utilize
nonstandard equipment.
‹Wherever possible equipment is simplified to reduce the
number of possible failure modes.

105
Equipment Simplification and
Standardization

Score yourself on your

existing Equipment
Simplification and
Standardization Program

106
Engineering Life Cycle Cost Analysis

‹Periodically or on demand, an analysis is performed to

determine the optimum economic life of selected items of
equipment.
‹Life cycle costing is required on all pieces of equipment
that are being installed prior to installation of the
equipment.
‹Life cycle costing of a minimum of two separate options is
required to determine the best option with the lowest
lifetime costs.
‹The life cycle costing methodology includes the “cost of
money”, cost to maintain equipment, life of the equipment,
cost to dispose of equipment, etc.
‹A documented procedure is utilized to determine the life
cycle cost of a piece of equipment.

107
Engineering Life Cycle Cost Analysis

Score yourself on your

existing Engineering Life
Cycle Cost Analysis Program

108
Operability and Maintainability Analysis

‹An operability and maintainability analysis is performed on

each new piece of equipment.
‹Operators and maintenance technicians are involved in the
analysis.
‹Clearances around equipment needed to maintain the
equipment are understood and provided.
‹Sight glasses, gauges, etc. are designed to allow an
operator to easily read the device and determine if the
equipment is operating properly without having to consult a
reference source. Example: a high and low mark are on
sight glasses.
‹Equipment is designed to ensure that the operator can
perform maintenance on the equipment where practical.

109
Operability and Maintainability Analysis

Score yourself on your

existing Operability and
Maintainability Analysis
Program

110
Where Did You Score?

Stage 4
Best-of-the-Best
Maintenance
Stage 3
Program
Reliability
Centered
Maintenance
Stage 2 Program
Advanced
Maintenance
Program
Stage 1
Basic Preventive
Maintenance
Program

111
Developing A Plan to Close the Gap

‹The previous slides contain characteristics of specific

maintenance programs.
‹The slides do not contain all of the characteristics of a
successful maintenance program.
‹For each maintenance and reliability program develop a
comprehensive list of all characteristics that are required to
make this program successful. Your corporation might
have this information. Companies like Fluor have these
lists.
Note: The maintenance programs identified in this
presentation are not all inclusive. Minor programs like
“developing rebuild specifications” have not been included.
All maintenance programs that you feel are vital to the
success of your plant should be identified and included.

112
Developing a Plan to Close the Gap

Have an independent team audit your maintenance and

reliability effort. Select team members that are not biased.
Utilize maintenance and reliability professionals from another
plant in your corporation or use an outside third party to
perform the analysis. This is not a finger pointing exercise.
The intent is to identify areas for improvement in your existing
programs.

113
Developing a Plan to Close the Gap

‹Analyze the data that was collected during the

maintenance and reliability assessment. Determine what
programs are important for you to improve. Target a few
key programs to improve.
‹Important:Many maintenance programs like RCM and
RCFA fail because the basic maintenance programs to
support advanced maintenance programs are not in place.
‹Ensure that the basic maintenance programs are in place
prior to attempting to deploy an advanced maintenance
program.

114
Developing a Plan to Close the Gap

‹Determine what programs your management will support

improving. You cannot improve a program without
management support.
Example: Management may want to outsource the
stockroom services rather than improve your existing
stockroom.

115
Develop Business Case – Stage 1

‹The easiest way to obtain management’s support is to

develop a business case that supports the improvements to
your maintenance and reliability program.
‹Your management are businessmen. Businessmen
respond to business cases. They do not respond to what
appears to be obvious to you.
‹You must have a solid business case to sell your plan.

116
Develop Business Case – Tips

Points to consider when developing your business case:

‹ Involve key people in the development of the business case. This
would include the accountant, maintenance leadership,
operations leadership, etc. If they are involved, and agree with
your business case they should support you when you present
the business case to management.
‹ Be conservative in your estimates. Once a few programs are
established and meet or exceed the payback calculations, you
will develop credibility.
‹ It is much easier to calculate savings and costs associated with
initial stages of a maintenance and reliability improvement effort
than the savings and costs associated with the advanced stages
of a maintenance and reliability improvement effort.

117
Develop Business Case – Stage 1

Step 1: Quantify the cost to improve your program

‹Identifythe number of maintenance and reliability
professionals needed to develop procedures and close
gaps for each program. These individuals should be
dedicated solely to this effort. It is recommended utilizing
someone from outside of the plant as a change agent.
They will have less of a tendency to be biased and they will
not be called upon to attend normal plant meetings or fight
fires.
‹Determinethe number of man hours needed by the
maintenance and reliability professionals to close this gap.
‹Determine the cost required to employ the maintenance
and reliability professionals to close this gap.

118
Develop Business Case – Stage 1

Step 1: Quantify the cost to improve your program

‹Any change effort should involve the personnel that will be
impacted by the change. Operators, maintenance
technicians, manufacturing engineers, etc. should be
included in the improvement project.
‹Determine the appropriate employees that should be
included in the effort and calculate the cost of including the
employees in this effort. In some cases the plant may elect
not to include the cost of employee involvement because,
“they are already paying this employee and it does not
represent an increase in costs to the plant.”

119
Develop Business Case – Stage 1

Step 1: Quantify the cost to improve your program

‹Determine the cost of materials, special tools, software,
etc. required in the improvement effort.

120
Develop Business Case – Stage 1

Step 2: Quantify the benefits realized by the program

improvement
‹Focus on tangible benefits.
‹Avoid intangible savings.
‹Examples follow on how to quantify benefits for
improvements to maintenance programs.

121
Develop Business Case – Stage 1

Examples of quantifying benefits - Lubrication Program and

Lubrication Training
‹Determine the lubrication requirements for each piece of
equipment.
‹Reduce the total number of lubricants utilized at your facility.
Note: Most plants only require 5 to 10 different oils or
greases. Once the number of lubricants are reduced, you can
start ordering more lubricant in bulk containers.
‹Calculate the amount of lubricant you will require. Obtain an
estimate from separate vendors to supply the lubricants in
bulk. It is important for the vendor to understand the they will
be the sole supplier of lubricants to the entire site.
‹Once you receive the quotes, you can compare your current
lubricant costs to projected lubricant costs. There should be a
sizable difference.

122
Develop Business Case – Stage 1

Examples of quantifying benefits - Lubrication Program and

Lubrication Training
‹Once the number of lubricants are reduced, the space
required for storing lubricants will be reduced. In many
plants the cost of floor space can be calculated.
‹Estimate the number of lubrication failures that you have
had in the last year and calculate an average cost for
lubrication failures.
‹Estimate the reduction in failures that you will have next
year by implementing a lubrication program.
‹Calculate the savings that will result in improving your
lubrication program.

123
Develop Business Case – Stage 1

Examples of quantifying savings - Lubrication Program and

Lubrication Training
Tip:
If you are setting up a lubrication program, you are most likely
in a reactive maintenance mode.
If you reassign an existing employee as a full time lubricator,
there will be no additional cost to the company.
If you assign the right person as the lubricator he/she will
immediately detect equipment that is about to fail.
Fix the equipment before it fails and report the savings realized
by fixing the equipment before it fails to management.
Example: Detecting a bearing that is ready to fail on a pump
and repairing it prior to failure will normally prevent damage
to the mechanical seal.

124
Develop Business Case – Stage 1

Examples of quantifying savings – Work initiation and

prioritization, planning and scheduling, management and
control of financial performance, work management
processes, deploying or improving a CMMS, and work
execution and review.

Consider linking all the above programs into a single program

aimed at improving and measuring wrench time. One of the
largest maintenance savings can be accomplished by
improving wrench time.

125
Develop Business Case – Stage 1

Examples of quantifying savings

Determine your current wrench time. Wrench time can be

determined by:
– Work sampling
– Estimating
– Using industry benchmarks for estimating wrench time

126
Develop Business Case – Stage 1

Examples of quantifying savings:

Your current wrench time is 20%.

After successfully implementing a Stage 1 – Basic
Preventive Maintenance Program your wrench time
increases to 45%.
There are 45 technicians in your department. The average
labor rate, including benefits, for each technician is $45 an
hour. The savings by increasing your wrench time can be
calculated as follows:

127
Develop Business Case – Stage 1

Examples of quantifying savings

From previous problem statement:
45 technicians x 2000 hours per year x $45 per hour = $4,050K/yr
Labor cost after improving wrench time =
(Current Wrench Time in % / Improved Wrench Time) X Labor
Cost/yr
Labor cost after improving wrench time = (20% / 45%) x
$4,050K/yr = 1,800K/yr
$4,050K/yr
- $1,800 K/yr
Total Labor Savings $ 2,250K/yr

128
Develop Business Case – Stage 1

Examples of quantifying savings – Preventive Maintenance

Program
‹Determine which pieces of equipment have the highest
equipment repair costs and contribute to the highest
production losses.
‹Determinewhich failures could be eliminated by preventive
maintenance activities.
‹Calculate the savings in repair cost and production losses
by performing preventive maintenance on each piece of
equipment.

129
Develop Business Case – Stage 1

Examples of quantifying savings – Materials Management,

Inventory Optimization, and Supplier Management
Improving the operation of stores can result in savings in the
following areas:
‹Reduction in “carrying cost”
‹Reduction in cost to purchase material
‹Reduction in losses due to shrinkage
‹Reductionin downtime - critical parts always available
when needed

130
 Develop Business Case – Stage 1

Examples of quantifying savings - Reduction in “carrying cost”

‹It costs money to keep an item in the stockroom. Costs include:
– Cost of the building space
– Cost to maintain equipment in storage e.g. clean, perform PM’s, etc.
– Cost of money
– Cost of labor to inventory equipment

‹The carrying costs can typically average between 15% to 30% of

the cost of a part. This is a yearly cost.
‹The savings realized by reducing the amount of inventory can be
directly calculated.
Cost of items no longer stocked x Cost to stock items (carrying
costs)

131
Stage 2 - Advanced Maintenance

‹MaintenanceShop Tools and Equipment

Enhancement
‹Craft Skills Enhancement
‹Assessment, Screening, and Hiring of Personnel
‹Condition Monitoring (PdM) and Failure Prediction
‹Craft Flexibility

132
Develop Business Case – Stage 2

Developing business cases for Stage 2 programs:

‹Duringthe development of a Stage 1 program a “Zero
Based Maintenance Budget” should be developed.
‹Once a “Zero Based Maintenance Budget” is developed it
is easier to develop quantifiable businesses case.
‹ZeroBased Maintenance Budget – Every asset has a
budget at the asset level.

133
 Develop Business Case – Stage 2

Maintenance of Pump-Bearing Replaced Based on Time

Preventive Maintenance Approach – Stage 1 Program

Equipment Name: Circulating Pump #3 Reactor

Total
Labor Mat'l Total Cost/
Task Frequency Labor Required To Perform Task Cost/yr Cost/yr Cost/yr 6 yrs

Mech I&E Lubr. Helper

$19/hr $19/hr $20/hr $14/hr
Adjust 0.25
Packing Twice/Week hr $364.00 $0.00 $364.00 $2,184.00
Replace
Packing Twice/Year 1.0 hr $38.00 $22.00 $60.00 $360.00
Change Oil Four/Year 0.5 hr $40.00 $12.00 $52.00 $312.00
Replace
Bearing Once/Year 8 hr 0.5 hr 0.5 hr 8 hr $283.50 $232.00 $515.50 $3,093.00
Meg Motor Once/Year 1 hr $19.00 $0.00 $19.00 $114.00

$744.50 $266.00 $1,010.50 $6,063.00

134
 Develop Business Case – Stage 2

Examples of quantifying savings – Condition Monitoring PdM

program
‹A significant savings can be realized by establishing a
condition monitoring program.
‹In Stage 1, Preventive Maintenance is utilized to prevent
failure of equipment. In Stage 2, wherever possible,
Predictive Maintenance PdM is used to prevent failure of
equipment.
‹Definition of Predictive Maintenance – It is not broke yet, let’s
fix it.
‹In a PM program the part is either replaced before it has
reached the end of its useful life or the part fails prior to being
replaced.
‹In a successful PM program the part has reached the end of
its useful life and is replaced prior to failure.

135
 Develop Business Case – Stage 2

Equipment Name: Circulating Pump #3 Reactor

Total
Labor Required To Perform Labor Mat'l Total Cost/
Task Frequency Task Cost/yr Cost/yr Cost/yr 6 yrs

Mech I&E Lubr.

$19/ $19/ $20/ Helper
hr hr hr $14/hr
Adjust
Packing Twice/Week 0.25 hr $364.00 $0.00 $364.00 $2,184.00
Replace
Packing Twice/Year 1.0 hr $38.00 $22.00 $60.00 $360.00

Change Oil Four/Year 0.5 hr $40.00 $12.00 $52.00 $312.00

Vibration
Monitor Once/Month 0.5 hr $114.00 $0.00 $114.00 $684.00 Task Added
Bearing
Replace Once/6 Yrs Replacement
8 hr 0.5 hr 0.5 hr 8 hr NA NA NA $515.50
Bearing (Estimate) Frequency
Changed

Meg Motor Once/Year 1 hr $19.00 $0.00 $19.00 $114.00

$575.00 $34.00 $609.00 $4,169.50

136
 Develop Business Case – Stage 2

Previous Maintenance Strategy (Preventive Maintenance Program)

Total
Labor Mat'l Total Cost/
Task Frequency Labor Required To Perform Task Cost/yr Cost/yr Cost/yr 6 yrs
Mech I&E Lubr. Helper
$19/hr $19/hr $20/hr $14/hr
Replace
Bearing Once/Year 8 hr 0.5 hr 0.5 hr 8 hr $283.50 $232.00 $515.50 $3,093.00

Meg Motor Once/Year 1 hr $19.00 $0.00 $19.00 $114.00

$302.50 $232.00 $534.50 $3,207

Future Maintenance Strategy (Predictive Maintenance Program)

Vibration
Monitor Once/Month 0.5 hr $114.00 $0.00 $114.00 $684.00 Task Added
Bearing
Replace Once/6 Yrs Replacement
8 hr 0.5 hr 0.5 hr 8 hr NA NA NA $515.50
Bearing (Estimate) Frequency
Changed

$114.00 $0.00 $114.00 $1,200

137
Develop Business Case – Stage 2

Examples of quantifying savings – Condition Monitoring PdM

program
‹Inthe previous example the costs of implementing a
program and the savings in labor and material were
estimated.
‹The overall cost and savings associated with a condition
monitoring program can be determined by totaling the cost
and savings for deploying the program for each asset in the
program.
‹Not included in this example would be start-up costs
associated with implementing a condition monitoring
program. In this case the cost of purchasing equipment and
training employees is not included.

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Develop Business Case –Stage 2

‹The cost and benefits analysis for many of the programs

associated with a Stage 2 program can be calculated by
using information from a Zero Based Maintenance Budget.
‹The costs and savings for the following Stage 2 programs
can be determined using this technique.
– Maintenance Shop Tools and Equipment Enhancement
– Craft Skill Enhancement
– Craft Flexibility

‹The costs and benefits for implementing an Assessment,

Screening and Hiring of Personnel program is difficult to
quantify.

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 Stage 3 - Reliability Centered Maintenance

‹Small Capital Project – Maintenance Pre-Planning

‹Shutdown (Outage/Turn Around) Management
‹Contractor Management
‹External Versus Internal Benchmarking
‹Root Cause Failure Analysis (RCFA or RCA)
‹Reliability Centered Maintenance (RCM)
‹TPM, Operator Performed Maintenance and Overall
Equipment Effectiveness (OEE)

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Develop Business Case – Stage 3

Examples of quantifying savings

Due to time constraints of the workshop, the cost of
quantifying costs and savings for the following Stage 3
programs have not been included in this workshop.
‹Small Capital Project – Maintenance Pre-Planning
‹Shutdown (Outage/Turn Around) Management
‹Contractor Management
Although it is difficult to estimate savings for the above
programs, savings can be estimated.

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Develop Business Case – Stage 3

Examples of quantifying savings – External Versus Internal

Benchmarking
Internal versus external benchmarks are available from
sources such as:
– Society of Maintenance and Reliability Professionals
– Your corporation may have internal benchmarks
– Third parties
– Etc.
‹Externalbenchmarks will provide information on how your
firm compares to your competitors.
‹Useful information to assist in estimating maintenance
costs and savings can be extracted by benchmarking your
firm to your competitor's firm.

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Develop Business Case – Stage 3

Examples of Quantifying Savings – External Versus Internal

Benchmarking

Maintenance Budget Based on Replacement Asset

Value (RAV)
% of RAV Required to

10
Maintain Asset

Pulp and Paper

5 Continuous Process
Batch Process
0
Bottom Third Second Top

Quartiles of Maintenance Program

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Develop Business Case – Stage 3

Examples of quantifying savings – Root Cause Failure

Analysis
‹Review the failures that your plant has had over the last
one to five years.
‹The cost and benefits of an RCFA program can be
calculated as the RCFA’s are performed.
– Cost of failure, to include production losses, is captured
in an RCFA analysis
– Cost of performing analysis and implementing action
items can be determined during RCFA process

144
Develop Business Case – Stage 3

Examples of quantifying savings – Reliability Centered

Maintenance
‹Select critical systems to receive RCM analysis.
‹Determine the cost to perform an RCM analysis
‹Perform an analysis and report savings as the analysis is
performed.
– A good RCM Analysis typically pays for itself prior to the completion
of the total RCM Analysis.
– The RCM Analysis team typically identifies low cost solutions that
will prevent significant failures.
– Example-Recently an RCM team identified that a vibration switch,
used to shutdown equipment in the event of excessive vibration, did
not work. If the equipment failed, the plant suffered a $1,000,000
loss. The cost of a vibration switch that would detect and shutdown
the equipment was $2,500 (installed). There were several similar
switches on identical equipment throughout the plant.

145
Develop Business Case – Stage 3

Examples of quantifying savings – TPM, Autonomous

Maintenance
Total Productive Maintenance (TPM) involves the
following:
– Maintenance Prevention in the design and selection of new
equipment.
– Predictive maintenance to determine the life expectancy of
components.
– Corrective maintenance to improve equipment performance.
– Preventive maintenance on a scheduled basis to ensure the
continuous smooth operation of equipment.
– Autonomous maintenance to involve production employees in
the total machine maintenance process. Autonomous
maintenance is operator performed maintenance.

146
Develop Business Case – Stage 3

Examples of quantifying savings – TPM, Autonomous

Maintenance
Autonomous Maintenance-Operator Performed Maintenance
‹Within the last 15 years there has been an effort to
centralize and computerize process controls.
‹An operator no longer has to continuously make rounds to
take readings, make adjustments, etc.
‹Operators that make continuous rounds begin to recognize
normal equipment noises, smells, vibration levels, etc.

147
Develop Business Case – Stage 3

Examples of quantifying savings – TPM, Autonomous

Maintenance
‹There are three primary reasons for implementing
autonomous maintenance
– The operators are required to make rounds to clean, tighten
bolts, tighten packing, etc. The operators will start to detect
and report pending failures. This is condition monitoring using
the human senses. The savings from detecting and repairing
equipment prior to failure can be captured.
– Transfer labor, that requires minimal skills, from highly skilled
technicians to operators.
– While the equipment is down, operators are not operating
equipment. Operators can be used to assist in the repair of
equipment. Operators gain an insight into how equipment
operates and less maintenance manpower is required to
repair equipment.

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Develop Business Case – Stage 3

Examples of quantifying savings – Overall Equipment

Effectiveness
Note: Many recent advances have been made in calculating
OEE. Many control systems can be used to calculate OEE
in real time.
‹OEE is calculated as a percentage.
‹The value of 1% of the OEE can be calculated.
‹OEE can be tracked – ideally real time.
‹The cost of improving the OEE can be directly calculated
once the value of 1% increase or decrease in OEE is
established.

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Stage 4 - Best of the Best Maintenance
Program

‹Reliability Performance and Data Management

‹Significant Failure Elimination
‹Equipment Simplification and Standardization
‹Engineering Life Cycle Cost Analysis
‹Operability and Maintainability Analysis

150
 Develop Business Case – Stage 4

Quartile
Benchmark - Results Metrics
Bottom Third Second Top

Stores/Replacement Value Percentage > 5.5 5.5 - 3.1 3.0 - 1.0 < 1.0
Maintenance Cost/Total Sales Percentage > 1.3 1.3 - .8 .7 - .3 < .3

Maintenance Cost/Replacement Percentage

Discrete > 5.0 5.0 - 3.2 3.2 - 2.0 < 2.0
Batch Process > 3.5 3.5 - 3.2 3.2 - 2.4 < 2.4
Chemical, Refining, Power > 4.8 4.8 - 3.0 3.0 - 2.5 < 2.5
Paper < 9.0 9.0 - 5.5 5.5 - 3.2 < 3.2
Availability
Discrete < 78 78 - 84 85 - 91 > 91
Batch Process < 72 72 - 80 81 - 90 > 90
Chemical, Refining, Power < 85 85 - 90 91 - 95 > 95
Paper < 83 83 - 86 87 - 94 > 94
Overall Equipment Effectiveness NA < 48 48 - 78 > 78

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 Develop Business Case – Stage 4

Quartile
Benchmark - Process Metrics

Bottom Third Second Top

Mechanic Wrench Time < 31 31 -41 42 - 52 > 52

Percentage of Planned Work > 65 66 - 78 79 - 94 > 95

PM Percentage by Operators 0 0-9 10 - 24 > 25

Replacement Value ($MM) per
Technician < 3.2 3.2 - 5.0 5.0 - 7.5 > 7.5

Stores Turnover < .5 .5 - .7 7 - 1.2 > 1.2

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 Develop Business Case – Stage 4

Quartile
Benchmark - Training and Staffing Ratios
Bottom Third Second Top

Span of Control <9 9 - 17 18 - 40 > 40

Mechanics per Effective Planner < 25 25 - 59 60 - 80 > 80

RAV ($MM) Per Maint and Reliability Engr < 50 50 - 200 200 - 250 > 250

Total Craft Designations >7 7-6 5-3 2

Training Hours Per Technician Per Year > 80 80 - 70 69 - 40 < 40

Training Cost Per Technician Per Year in $K >3 3 - 1.8 1.8 - 0.5 < 0.5

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 Develop Business Case – Stage 4

100
Plants with the best overall
equipment effectiveness

90
tend to have the lowest
maintenance cost and use

Overall Equipment Effectiveness

80
systematic failure
elimination, profit centered

Effectiveness

70
maintenance, and
performance contracting.

60
50
40
30

2 4 6 8 10 12 14
Maintenance Cost as a % of Asset Replacement Value
Efficiency

Systematic Failure Elimination Profit Centered Maintenance

Performance Based Contracting None of these behaviors

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Obtain Management Support for Closing
Gaps

Management support can be obtained by:

‹Presentingan accurate evaluation of your existing
maintenance programs to management.
‹Comparingyour maintenance programs to industry
benchmarks.
‹Presenting an accurate business case to support the need
for improving your maintenance programs.
‹Including key stakeholders in the process.

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Developing Improvement Plan

All the key stakeholders should be involved in developing the

improvement plan. The plan must:
‹Be simple and easy to understand.
‹Be clearly communicated.
‹Include change management strategy.
The initiative should ideally be led by a person that is
dedicated to this effort. It is recommended to have an
independent third party lead the improvement effort.

156
Developing Applicable Metrics

Applicable maintenance metrics need to be developed to

track the success of your maintenance improvement
project.
There are hundreds of maintenance metrics. The
maintenance metrics that are selected for a maintenance
improvement effort should:
‹Be tied directly to the company’s goals.
‹Track progress towards improving the maintenance
program, or highlight areas that need attention.
‹Be appropriate. Example - tracking maintenance budget
performance at a department level will not yield as much
usable knowledge as tracking budget performance at the
asset level.

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Measuring Success of Improvement Program

The success of the improvement program will be reflected in

the maintenance metrics. A successful measurement
program will include:
‹Top management should play an active role in the team
that reviews the metrics and acts in a timely manner to
ensure that the appropriate goals of each program are
achieved.
‹Realtime metrics that can be reviewed and easily
communicated to the key stakeholders.
‹Includea reward and recognition system linked to the
performance indicators.

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Continuous Improvement

It is important to continue to improve your maintenance

programs. What does this mean?
‹The continuous process is continuous.
‹Have an outsider review your process. An outsider can
often identify areas for continuous process.
‹Celebrate and award accomplishments. Do not reward
reactive activities.
‹Make certain that your improvements involve production.
‹Develop a system to encourage continuous improvement
that works for you. Do not plagiarize.

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Continuous Improvement

‹Benchmark against other companies not others within your

company. You need to compete against your competitors
and not against yourself.
‹Continue to develop business cases to support any
continuous improvement initiatives. Remember-those
approving your funding are businessmen that understand
business cases.

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Continuous Improvement

‹Look for “Oh Wow” improvements. Look for major

improvements. Examples, Do you know?
– Companies can detect defective shafts without taking
equipment apart.
– Corrosion under insulation can be detected in real time as
quickly as you can walk down a pipe.
– There is a way to use ultrasonic grease guns to effectively
allow operators to grease electric motors.
– Tubes in heat exchangers can be tested, to determine tube
thickness, without cleaning.

161
Contact information

‹For more information contact :

• Brad Cunic, Executive Director, Fluor
864-281-6286 [Link]@[Link]
• John Barker, Director of Assessments
864-281-6136 [Link]@[Link]
• Dave Schrader, Director O&M
864-281-8138 [Link]@[Link]
• Michael Eisenbise , Director O&M
864-281-8625 [Link]@[Link]

162