Using maintenance as a strategic business asset

To become an accomplished golfer, a number of distinct skills are needed. Divided very basically, you need a strong short game and a strong long game — that is, you need to be able to drive the ball and putt the ball equally well. After mastering each of these skills separately, you can merge them together to become a formidable competitor.


To become an accomplished golfer, a number of distinct skills are needed. Divided very basically, you need a strong short game and a strong long game — that is, you need to be able to drive the ball and putt the ball equally well. After mastering each of these skills separately, you can merge them together to become a formidable competitor.

A similar analogy applies to companies seeking to maximize the performance of their productivity assets. Like the core skills required to become a proficient golfer, plant managers have four strategic P's available to help them achieve better return on assets: people, processes, plant equipment, and predictive maintenance. Those companies that learn to maximize the value of these core areas are the ones that consistently outperform the competition and enjoy greater long-term success.

People: the often-overlooked variable

Technology, while critical to manufacturing operations, is not the sole variable in an organization's success. For example, you can have the most advanced technology available, but if people don't know how to properly use or maintain it, the technology could become a cost and a liability rather than a net gain. In fact, now that technology is everywhere, it is people and their performance that make the crucial difference.

Oftentimes, plants become overwhelmed by technology because employees lack sufficient knowledge or operational skills for the jobs they are assigned. As a result, plants never have the time to plan ahead and ultimately become more and more reactive in their maintenance approach. This invariably leads to production delays and additional costs. In today's high-tech world of industrial automation, it has become increasingly important for companies to closely match employee skill levels with the specific needs of the equipment and processes for which they are responsible.

To achieve and sustain success in the area of human performance, companies must adopt a strategic, long-term approach.

Performance assessment

The first step is to conduct a broad-based performance assessment that analyzes and identifies how well employees are performing their responsibilities and job assignments. The goal is to identify the strengths of the maintenance team and determine what areas require additional support. At the engineering and maintenance level, this may mean looking at competencies, readiness levels, preparedness of employees to take on new responsibilities, recruiting and/or hiring methods, and policies for retaining staff. This information will also help recruit and select the best people for each skill profile.

Another key goal of the performance assessment is to determine the appropriate approaches to training — such as online, onsite, or classroom training — that lead to the highest levels of retention or the most improvement in worker skills or knowledge.

Next, companies need to make sure that their investments in people are aligned with the strategy of the organization. If a company is continually willing to cut corners in the area of job training, this deficiency will weaken the value of this important pillar of your productivity strategy (much like neglecting your putting skills results in a weak short game and poor overall performance).

Finally, to help ensure long-term success, it's important to develop a set of metrics for measuring performance improvements. For best results, these metrics need to have controllability. That is, they need to be controllable by those who are being held accountable for performance. That's because the strongest performance measures are those that are "owned" by those who can influence performance and effectively used by these people to drive performance improvements.

The short-term benefit of investing in people is identification of opportunities throughout the organization. The long-term benefit is putting processes in place that improve productivity.

Good processes equal good results

For many, the term "processes" is instantly equated with production lines and manufacturing processes. That is a limited view of the term. Experience indicates that the highest-performing organizations are rigorous about all of their processes, especially as they relate to their development, documentation, and ongoing commitment to improvement.

Therefore, an important component of effective productivity strategy is understanding the processes governing engineering and maintenance functions. This includes the ability to point out the bottlenecks, eliminate activities that provide little return, and develop alternative ways to achieve better results.

Processes should be examined to determine whether or not they are functioning as efficiently as they could be. When factors such as workflow systems, written procedures, critical production directions, and maintenance guidelines are properly analyzed, accurate and efficient solutions can be developed.

When a problem arises is not the time to discuss a possible response; rather, it is time for action. In many cases, the reason for downtime is simply a lack of understanding of the current process and the factors limiting success, and not putting in the correct metrics to quantify impact.

As companies begin to evaluate, assess, and redefine various processes, they'll often uncover things that consume excessive resources. Understanding these processes, documenting alternatives, and reducing the gap between occurrence and reaction time will improve results. This exercise can also help identify what activities it may be appropriate for an outside service provider to perform.

The good news is that every time you implement a change, the smarter you get in terms of how you evaluate what you are doing and the more you become aware of other opportunities to reengineer, re-create, and restructure. But you have to prioritize which ones are going to give you the biggest bang for the buck.

Unnecessary spare parts

An enormous cost drain for many companies is the buildup of stockpiles of unnecessary spare parts — in the storeroom or "stashed" somewhere on the plant floor. In many plants, parts are automatically sent for repair and then returned to inventory, regardless of the number of spare parts already available. The net result is another extra spare part in inventory. The purchasing, insuring, and storing of these spare parts can cost hundreds of thousands of dollars each year. As this is repeated over time, excess parts continue to multiply.

In reviewing processes, keep in mind that the solution may not always involve a technology investment. In fact, many of today's successful companies are not necessarily those with the newest equipment or the most resources, but rather the best manufacturing processes.

Therefore, before investing in a solution, it's important that managers clearly understand the problem they're trying to solve. That's because no matter how big or small the maintenance function, or what types of tools are employed, there is no substitute for basic process implementation. This is true of plant floor equipment as well as storeroom management and component repair services.

Know your plant equipment

In assessing the maintenance needs of plant equipment, organizations need to establish predetermined expectations of performance and uptime requirements. For example, if a line goes down, what is the maximum allowable downtime limit? One hour? Five hours? Two days? When equipment breaks down is not the time to figure out whether you have the needed parts on hand or whether maintenance personnel are available to minimize the delay.

In many cases, the value brought by a maintenance department may be measured by how it impacts production throughput. Here equipment reliability is king. For example, if machines aren't available, the company can't produce products, and profit opportunities are missed. In this situation, the priority is on directly supporting production output goals and keeping equipment up and running.

In order to effectively optimize plant assets, companies must first document the facility's installed base — including mechanical, electrical, and electronic equipment. Maintenance managers need a complete understanding of which machines, as well as which components within those machines, are critical for maintaining asset availability.

Considerations are given to the environmental conditions and maintenance history of equipment to produce a mean-time-between-failure (MTBF) report that predicts how long each component should last, given its performance history and current working conditions. The report provides recommendations for inventory levels to ensure that all critical parts are available when needed, and excess items are minimized.

Using this information, companies can make informed decisions based on calculated maintenance needs and also determine opportunities for improvement in spare parts inventory. The result is an increase or decrease in spare parts inventory that corresponds to operational needs.

Moreover, when considering new asset investments, instead of just looking at capital costs and depreciation benefits of new equipment, plant and department managers must also factor in the effects of operational costs, spares, service support, and upgradeability. This analysis requires developing an asset life-cycle plan that considers all the benefits of the current technology, while planning for upgrades to more advanced solutions.

Predictive maintenance: making the transition

It's well established that proactive maintenance is much less expensive than reactive maintenance. But for many companies, moving from a reactive to a proactive mode is one of the most difficult transitions. Historically, in rough times, the knee-jerk reaction has been to opt for short-term cost savings. This includes curtailing maintenance spending, ditching predictive activities, and reverting to day-to-day fail-and-fix practices. In the end, short-term savings sacrifice longer-term gains.

Such spending decisions are shortsighted and less strategic because they are often made in response to emergency situations. In other words, the priority is to resolve the immediate crisis and get production back up and running as quickly as possible. Oftentimes, what keeps companies trapped in a continuous cycle of reactive maintenance is a lack of data that shows the true costs of this approach.

In situations where companies are trying to change a culture (such as moving from a reactive to a proactive strategy), hard evidence is often required to alter the status quo. The most credible way to demonstrate the value is to examine past downtime situations, identify actions that could have minimized the impact, quantify the impact, and calculate the improvement in a real-world example. This will help lay the foundation for future programs.

Being proactive requires a willingness to take action based on historical results versus waiting for a problem to arise. The key is that plants must be willing to make a small initial investment in proactive strategies, beginning with the most critical processes and machinery. They must then be able to measure and document the benefits.

By transitioning from reactive to predictive/proactive maintenance, organizations can significantly reduce their maintenance costs, with virtually no negative impact on productivity or facility availability.

Collaboration: another key variable

Companies continue to improve efficiencies, but opportunities for cost reductions still exist, particularly in the area of collaboration to support the four strategic P's. Whether applied throughout the engineering and maintenance organizations or focused solely on a specific activity, a collaborative strategy can be more cost effective over the long term. First, organizations need to review the pain points within their support functions and determine if these areas are strategic capabilities that should be managed by their own organization, or whether they could be handled more effectively by an outside service provider.

In today's lean environment, it's critical for companies to focus on doing what they do best — making products. In considering a collaborative approach, the first step is to look at the strategy of the organization. Where does it intend to invest money and people? If it continually neglects and fails to provide adequate support for equipment, processes, and people within a particular activity, then that activity is likely a good candidate for outside collaboration.

Many manufacturers already have a strong foundation in place, but with proper support and commitment from an outside partner, that function can be expanded in scope and effectiveness — without losing valuable employees.

The key to success in today's competitive manufacturing environment is asset optimization — both workforce and capital — to improve a company's performance. As with any activity, there is always room for improvement. But those who learn to master the core skills — whether it's putting, driving or the four strategic P's — will enjoy superior performance and have a distinct competitive advantage.

Author Information
Mike Laszkiewicz is the vice president of the Customer Support and Maintenance business at Rockwell Automation. In his current role he is responsible for Rockwell Automation engineering and maintenance support services, which encompasses the company's Asset Management, Customer Support, and Training capabilities.
Prior to assuming his current position in 2004, Laszkiewicz held positions as vice president and general manager of Asset Management where he was instrumental in developing Rockwell Automation's strategy for addressing the maintenance, repair, and operations (MRO) needs of manufacturers around the world.
An industry advocate for viewing maintenance as a strategic business opportunity, Laszkiewicz has presented at a number of conferences including ISA Expo, ISA Process Control Conference, American Institute of Chemical Engineers (AIChE), TAPPI and the Lean Management Solutions.
He earned his bachelor's degree in industrial operations management from the University of Wisconsin-Milwaukee. Laszkiewicz can be reached at (414) 382-3736 or .

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