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© 2009 Shire Systems Limited
learnShop™
Lean maintenance Lean maintenance using using measuresmeasures to boost performanceto boost performance
By Paul Dean, CEng
Shire Systems Limited
© 2009 Shire Systems Limited
This presentationThis presentation is not particularly about is not particularly about CMMS. After all, CMMS is just a tool, albeit a CMMS. After all, CMMS is just a tool, albeit a very important one very important one –– for itfor it’’s the means by which s the means by which maintenance professionals can secure success maintenance professionals can secure success for their equipmentfor their equipment--dependent organisations.dependent organisations.
When we talk about craftsmanship, we tend not When we talk about craftsmanship, we tend not to focus on the tools used to focus on the tools used –– we accept them as we accept them as a necessity. Our real interest lies in aspects of a a necessity. Our real interest lies in aspects of a craftsmancraftsman’’s knows know--how and skill.how and skill.
Accordingly, this presentation is principally about Accordingly, this presentation is principally about Maintenance Management and the role of the Maintenance Management and the role of the Engineering Manager Engineering Manager –– your roleyour role
© 2009 Shire Systems Limited
What will be coveredWhat will be covered
Lean times ahead Lean times ahead -- Lean and the recession Lean and the recession
Where you, as Engineering Manager, fit inWhere you, as Engineering Manager, fit in
Maintenance cause and effect Maintenance cause and effect –– the Costthe Cost--Value Value SyndromeSyndrome
Lean and TPMLean and TPM
BeforeBefore-- and afterand after--failure maintenance regimesfailure maintenance regimes
The lagging and leading indicators of maintenance The lagging and leading indicators of maintenance performanceperformance
The big hitter performance indicators and practicesThe big hitter performance indicators and practices
Managing using Managing using ‘‘measuresmeasures’’
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin
To survive the recession, you must To survive the recession, you must take market share from your take market share from your competitors. Therefore, if your competitors. Therefore, if your organisation has a performance organisation has a performance gap, you must close it gap, you must close it -- and quickly
The DODODidus ineptus
Don’t end up like me!
and quickly
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin
To survive the recession, you must To survive the recession, you must take market share from your take market share from your competitors. Therefore, if your competitors. Therefore, if your organisation has a performance organisation has a performance gap, you must close it gap, you must close it -- and quicklyand quickly
The manufacturers left standing will The manufacturers left standing will probably be the ones that have probably be the ones that have embraced embraced Lean
The DODODidus ineptus
Don’t end up like me!
Lean
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
Daniel Jones, the UK High Priest of Lean, observes:Daniel Jones, the UK High Priest of Lean, observes:
A recession is a good time for A recession is a good time for Lean. Organisations can either Lean. Organisations can either postpone Lean and resort to postpone Lean and resort to traditional cost cutting, or they traditional cost cutting, or they can accelerate and redouble can accelerate and redouble their progress with Lean. I doubt their progress with Lean. I doubt the former will last the course. the former will last the course. But the latter stand a good But the latter stand a good chance of surviving and laying chance of surviving and laying the foundations for future the foundations for future prosperity as they turn the tables prosperity as they turn the tables on their competitorson their competitors……
Lean Enterprise Academy newsletter, November, 2008
www.leanuk.org
© 2009 Shire Systems Limited
Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind
© 2009 Shire Systems Limited
Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind
You are a maintenance professional. You are a maintenance professional. Above all, you are a Above all, you are a leader. leader. You must You must also be an also be an innovatorinnovator. You are closest . You are closest to the action and itto the action and it’’s you that must drive s you that must drive maintenance change maintenance change -- if not you,if not you, whowho??
© 2009 Shire Systems Limited
Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind
You are a maintenance professional. You are a maintenance professional. Above all, you are a Above all, you are a leader. leader. You must You must also be an also be an innovatorinnovator. You are closest . You are closest to the action and itto the action and it’’s you that must drive s you that must drive maintenance change maintenance change -- if not you,if not you, whowho??
Ask yourself the question: Ask yourself the question: Am I a Am I a true leadertrue leader--innovator or a repair innovator or a repair administrator? administrator?
© 2009 Shire Systems Limited
You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate the need to innovate
© 2009 Shire Systems Limited
You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate. the need to innovate.
As an Engineering Manager, you hold As an Engineering Manager, you hold the key to increased manufacturing the key to increased manufacturing performance performance –– so ask yourself a so ask yourself a second question second question How fast am I How fast am I making things better?making things better?
© 2009 Shire Systems Limited
You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate. the need to innovate.
As an Engineering Manager, you hold As an Engineering Manager, you hold the key to increased manufacturing the key to increased manufacturing performance performance –– so ask yourself a so ask yourself a second question second question How fast am I How fast am I making things better?making things better?Your organisationYour organisation’’s post recession s post recession survival depends on your answer to survival depends on your answer to these acid test questionsthese acid test questions
© 2009 Shire Systems Limited
Consider two companies producing Consider two companies producing the same product the same product
One has healthy, reliable One has healthy, reliable equipmentequipment……
© 2009 Shire Systems Limited
Consider two companies producing Consider two companies producing the same product the same product
…….the other has unhealthy, .the other has unhealthy, troublesome equipment troublesome equipment
© 2009 Shire Systems Limited
Consider two companies producing Consider two companies producing the same product the same product
The company with the greater The company with the greater downtime faces the following downtime faces the following disadvantagesdisadvantages……
© 2009 Shire Systems Limited
Disadvantages of unhealthy equipmentDisadvantages of unhealthy equipment
More defectsMore defects
More overtimeMore overtime
More material costsMore material costs
More overheadsMore overheads
More shipping delaysMore shipping delays
More standby plant More standby plant –– wasted capital wasted capital -- a bigger a bigger ‘‘hiddenhidden’’ factoryfactory
More health, safety and More health, safety and environmental violations and environmental violations and expenseexpense
© 2009 Shire Systems Limited
Disadvantages of unhealthy equipmentDisadvantages of unhealthy equipment
Which one will survive the recession? Which one will survive the recession?
More defectsMore defects
More overtimeMore overtime
More material costsMore material costs
More overheadsMore overheads
More shipping delaysMore shipping delays
More standby plant More standby plant –– wasted capital wasted capital -- a bigger a bigger ‘‘hiddenhidden’’ factoryfactory
More health, safety and More health, safety and environmental violations and environmental violations and expenseexpense
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture
However, However, lean manufacturing lean manufacturing assumes that sufficient assumes that sufficient machine Availability already machine Availability already exists in the first placeexists in the first place
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
I wish
Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture
However, However, lean manufacturing lean manufacturing assumes that sufficient assumes that sufficient machine Availability already machine Availability already exists in the first placeexists in the first place
Companies managing only 60 Companies managing only 60 or 70% Availability during or 70% Availability during scheduled uptime CANNOT be scheduled uptime CANNOT be LeanLean
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
Many manufacturers still operate Many manufacturers still operate without applying best practice in without applying best practice in maintenance management. Ipso maintenance management. Ipso facto, their facto, their achievable achievable manufacturing performance is manufacturing performance is totally compromisedtotally compromised
© 2009 Shire Systems Limited
Lean times aheadLean times ahead
Many manufacturers still operate Many manufacturers still operate without applying best practice in without applying best practice in maintenance management. Ipso maintenance management. Ipso facto, their facto, their achievable achievable manufacturing performance is manufacturing performance is totally compromisedtotally compromised
Poor performance has its basis Poor performance has its basis in a reactive, inept approach to in a reactive, inept approach to maintenance maintenance –– the the absence of absence of planningplanning,, coupled withcoupled withequipment abuseequipment abuse
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost icebergThe costThe cost--value syndromevalue syndrome
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’
The Maintenance The Maintenance DepartmentDepartment’’s headcount and s headcount and expenses make up the tip of expenses make up the tip of the iceberg the iceberg –– the part seen the part seen by Management and by Management and onlookers
Maintenance
onlookers
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’
The Maintenance The Maintenance DepartmentDepartment’’s headcount and s headcount and expenses make up the tip of expenses make up the tip of the iceberg the iceberg –– the part seen the part seen by Management and by Management and onlookersonlookers
But the bulk of the costs lie But the bulk of the costs lie hidden beneath the surface hidden beneath the surface and present a huge danger and present a huge danger to unwary businessesto unwary businesses…
Maintenance
…
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Often too detached from Often too detached from the workplace, the workplace, Management can be Management can be infected with a pennyinfected with a penny--pinching, pinching, ‘‘beanbean--countingcounting’’mentality
Maintenance
mentality
How much of an iceberg is seen above water?
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Often too detached from Often too detached from the workplace, the workplace, Management can be Management can be infected with a pennyinfected with a penny--pinching, pinching, ‘‘beanbean--countingcounting’’mentalitymentality
Too many are obsessed Too many are obsessed with cost cutting with cost cutting -- rather rather than with ensuring than with ensuring resources are properly resources are properly deployed to add valuedeployed to add value
I’ll nuke itWaste!
Maintenance
How much of an iceberg is seen above water?
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost
To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost
To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget
The value that maintenance adds to The value that maintenance adds to manufacture often gets ignored. But, manufacture often gets ignored. But, maintenancemaintenance’’s contribution to uptime s contribution to uptime and product quality is worth more than10 and product quality is worth more than10 times the potential for maintenance cost times the potential for maintenance cost reductions
Don’t!
reductions
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost
To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget
The value that maintenance adds to The value that maintenance adds to manufacture often gets ignored. But, manufacture often gets ignored. But, maintenancemaintenance’’s contribution to uptime s contribution to uptime and product quality is worth more than10 and product quality is worth more than10 times the potential for maintenance cost times the potential for maintenance cost reductionsreductions
The Cost-Value syndrome
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
How much of an iceberg is seen above water?
Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface
But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation
10
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
(Non) Machine Availability
(Non) Process Capability
(Non) Regulatory Compliance
(Inflated) Operating Costs
(Wasted) Capital
Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface
But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface
But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation
<10%
(Non) Machine Availability
(Non) Process Capability
(Non) Regulatory Compliance
(Inflated) Operating Costs
(Wasted) Capital
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface
But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation
<10%The ‘hidden’
factory (Non) Machine Availability
(Non) Process Capability
(Non) Regulatory Compliance
(Inflated) Operating Costs
(Wasted) Capital
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
WellWell--targeted, valuetargeted, value--adding cost reduction adding cost reduction --driven by you, the driven by you, the Engineering ManagerEngineering Manager–– can decrease the can decrease the overall mass of the overall mass of the maintenance cost maintenance cost icebergiceberg……
(Non) Machine Availability
(Non) Process Capability
(Non) Regulatory Compliance
(Inflated) Operating Costs
(Wasted) Capital
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
WellWell--targeted, valuetargeted, value--adding cost reduction adding cost reduction --driven by you, the driven by you, the Engineering ManagerEngineering Manager–– can decrease the can decrease the overall mass of the overall mass of the maintenance cost maintenance cost icebergiceberg……
Cost cutting is very different from value-adding cost
saving
© 2009 Shire Systems Limited
The maintenance cost icebergThe maintenance cost iceberg
In the process, the In the process, the ‘‘visiblevisible’’ costs of costs of maintenance will reduce maintenance will reduce automatically automatically –– by half, by half, or more, in some or more, in some casescases.. But, this saving is But, this saving is secondary compared to secondary compared to the more than 10the more than 10--fold fold other gains realised in other gains realised in production, profit and production, profit and competitive advantage
Maintenance
competitive advantage
© 2009 Shire Systems Limited
Beware!Beware! The iceberg gets biggerThe iceberg gets bigger
A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites
© 2009 Shire Systems Limited
Beware!Beware! The iceberg gets biggerThe iceberg gets bigger
A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites
Gurus of Lean say that the downtime Gurus of Lean say that the downtime costs in a Leancosts in a Lean--configured configured manufacturing cell are 5 to 30 times manufacturing cell are 5 to 30 times more than in other manufacturing more than in other manufacturing environments environments -- because of the direct because of the direct and immediate losses kicking in and immediate losses kicking in along the manufacturing & supply along the manufacturing & supply chain chain
© 2009 Shire Systems Limited
Beware!Beware! The iceberg gets biggerThe iceberg gets bigger
A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites
Gurus of Lean say that the downtime Gurus of Lean say that the downtime costs in a Leancosts in a Lean--configured configured manufacturing cell are 5 to 30 times manufacturing cell are 5 to 30 times more than in other manufacturing more than in other manufacturing environments environments -- because of the direct because of the direct and immediate losses kicking in and immediate losses kicking in along the manufacturing & supply along the manufacturing & supply chain chain
The maintenance cost iceberg can The maintenance cost iceberg can become even more menacing!become even more menacing!
© 2009 Shire Systems Limited
Failure repair and preventionFailure repair and preventionReactive and proactive maintenanceReactive and proactive maintenance
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Most maintenance is Most maintenance is carried out carried out after failureafter failure
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Most maintenance is Most maintenance is carried out carried out after failureafter failure
Disruptive functional failures - breakdownsaffecting production
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Most maintenance is Most maintenance is carried out carried out after failureafter failure
Traditionally, maintenance Traditionally, maintenance has been repairhas been repair--oriented. oriented. Break it, then fix it.Break it, then fix it.Reasonable enough in Reasonable enough in Victorian times Victorian times -- maybemaybe --but not now!but not now!
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Most maintenance is Most maintenance is carried out carried out after failureafter failure
Traditionally, maintenance Traditionally, maintenance has been repairhas been repair--oriented. oriented. Break it, then fix it.Break it, then fix it.Reasonable enough in Reasonable enough in Victorian times Victorian times -- maybemaybe --but not now!but not now!
This has resulted in a This has resulted in a very harmful legacy very harmful legacy predisposition predisposition ––aversion to planningaversion to planning
5 to 10% of work planned
90 to 95% of work unplanned
Before failure After failure
failurefailureM
aint
enan
ce C
osts
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense
5 to 10% of work planned
90 to 95% of work unplanned
Before failure After failure
failurefailureM
aint
enan
ce C
osts
expense
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense expense
Unplanned jobs Unplanned jobs routinely take 3 times routinely take 3 times longer than a planned longer than a planned job job -- and equipment and equipment uptime and capability uptime and capability is lost into the is lost into the bargain bargain –– another another 10X factor hit!10X factor hit!
5 to 10% of work planned
90 to 95% of work unplanned
Before failure After failure
failurefailureM
aint
enan
ce C
osts
© 2009 Shire Systems Limited
Reactive maintenanceReactive maintenance
Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense expense
Unplanned jobs Unplanned jobs routinely take 3 times routinely take 3 times longer than a planned longer than a planned job job -- and equipment and equipment uptime and capability uptime and capability is lost into the is lost into the bargain bargain –– another another 10X factor hit!10X factor hit!
5 to 10% of work planned
90 to 95% of work unplanned
Before failure After failure
failurefailureM
aint
enan
ce C
osts
The reason’s simple…
© 2009 Shire Systems Limited
Throwing good money after badThrowing good money after badAfter a breakdown, the time to establish the facts and decide After a breakdown, the time to establish the facts and decide repair needs automatically increases due to:repair needs automatically increases due to:
Confusion Confusion
NonNon--availability of labour, materials, availability of labour, materials, equipment and technical information equipment and technical information
The possible need to search out and The possible need to search out and cannibalise other plant cannibalise other plant
When contractors and hired When contractors and hired equipment are needed, the time and equipment are needed, the time and money wastage escalates money wastage escalates
When failure is catastrophic, the When failure is catastrophic, the consequences of the collateral consequences of the collateral damage is anyonedamage is anyone’’s guess
Ouch!
s guess
© 2009 Shire Systems Limited
Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……
© 2009 Shire Systems Limited
Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……
From ‘‘So what?So what?’’ to…
‘‘What aWhat a catastrophe!catastrophe!’’
© 2009 Shire Systems Limited
Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……
Speed loss, quality loss, minor stops, yield loss
Partial Failure
© 2009 Shire Systems Limited
Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……
Speed loss, quality loss, minor stops, yield loss
Partial Failure
Breakdown!Production stops
Total Failure
© 2009 Shire Systems Limited
Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……
Speed loss, quality loss, minor stops, yield loss
More expensive to fix Breakdown
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
Speed loss, quality loss, minor stops, yield loss
More expensive to fix Breakdown
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
Total Failurewith
catastrophic damage
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
More expensive to fix Breakdown
Speed loss, quality loss, minor stops, yield loss
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
The sky is the The sky is the limit for loss!limit for loss!
Total Failurewith
catastrophic damage
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
More expensive to fix Breakdown
Speed loss, quality loss, minor stops, yield loss
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
The sky is the The sky is the limit for loss!limit for loss!
Total Failurewith
catastrophic damage
The Engineering Manager is mainly responsible for these avoidable failures
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
More expensive to fix Breakdown
Speed loss, quality loss, minor stops, yield loss
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
The sky is the The sky is the limit for loss!limit for loss!
Total Failurewith
catastrophic damage
Senior management is responsible for these avoidable calamities
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
Speed loss, quality loss, minor stops, yield loss
More expensive to fix Breakdown
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
The sky is the The sky is the limit for loss!limit for loss!
Total Failurewith
catastrophic damageBasically a failure of due diligence. Lack of proper
regard for risk management, ignoring the advice of experts
and penny pinching
© 2009 Shire Systems Limited
Gambling with failureGambling with failure
Speed loss, quality loss, minor stops, yield loss
More expensive to fix Breakdown
Partial Failure
Breakdown!Production stops
Total Failure
Total Failurewith local
collateral damage
The escalation of The escalation of damagedamage……
The sky is the The sky is the limit for loss!limit for loss!
Total Failurewith
catastrophic damageBasically a failure of due diligence. Lack of proper
regard for risk management, ignoring the advice of experts
and penny pinching
Depressingly common – Just recall the many
petrochemical plant and railway disasters
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures
Management emphasis must be on Management emphasis must be on equipment uptime and capability equipment uptime and capability improvement improvement –– not sidenot side--tracked onto tracked onto maintenance cost reduction maintenance cost reduction
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures
Management emphasis must be on Management emphasis must be on equipment uptime and capability equipment uptime and capability improvement improvement –– not sidenot side--tracked onto tracked onto maintenance cost reduction maintenance cost reduction
This requires a switch from reactive This requires a switch from reactive firefire--fighting to engineeringfighting to engineering--led led analytical thinking and proactive analytical thinking and proactive leadershipleadership
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be
Hmm, that’s what I’m really
paid to do
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be
You should strive to You should strive to maximise the amount maximise the amount of maintenance you of maintenance you do do beforebefore failurefailure
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failureM
aint
enan
ce C
osts
failurefailure
Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be
You should strive to You should strive to maximise the amount maximise the amount of maintenance you of maintenance you do do beforebefore failurefailure
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving
1
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
First the reliability improvement
st
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving
1
2
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
First the reliability improvement
Then the maintenance cost saving
st
nd
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving?
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
First the reliability improvement
Then the maintenance cost saving
Please don’t try to put the cart
before the horse!
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving?
…that’s just common horse
sense!
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
First the reliability improvement
Then the maintenance cost saving
© 2009 Shire Systems Limited
Proactive maintenanceProactive maintenance
After failureBefore failurefailurefailure
Cost Saving
In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome
First the reliability improvement
Then the maintenance cost saving
Do avoid shooting yourself in the foot!
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
Reliability
Availability ∝ Reliability Maintainability
Operating Operating statestate
Down Down statestate
With acknowledgement to Richard C Lamb –’Availability Engineering & Management for
Manufacturing Plant Performance’
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
ReliabilityOperating Operating statestate
Down Down statestate These influences
of ‘state’ are assured by TPM
Availability ∝ Reliability Maintainability
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TPM
later…
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
ReliabilityOperating Operating statestate
Down Down statestate
Availability ∝ Reliability Maintainability
Is King!
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
ReliabilityOperating Operating statestate
Down Down statestate
MTTR
Availability ∝ Reliability Maintainability
These are the prime indicators of performance
Mean Time Between Failure
Mean Time To Repair
MTBF
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
ReliabilityOperating Operating statestate
Down Down statestate
MTTR
Availability ∝ Reliability Maintainability
This is the Royal
measure!
MTBF
© 2009 Shire Systems Limited
Uptime Uptime -- Downtime state diagramDowntime state diagram
Maintainability
Plant Design, Operation and Maintenance
ReliabilityOperating Operating statestate
Down Down statestate
MTTR
Availability ∝ Reliability Maintainability
This is the Royal
measure!
MTBF
Measure and track MTBF for individual machines, cells, lines and whole sites
Maximise
Minimise
© 2009 Shire Systems Limited
Take the lead!Take the lead!
Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details
© 2009 Shire Systems Limited
Take the lead!Take the lead!
Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details
ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance
© 2009 Shire Systems Limited
Take the lead!Take the lead!
Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details
ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance
You need to apply the Total You need to apply the Total Productive Maintenance framework to Productive Maintenance framework to achieve optimal manufacturing achieve optimal manufacturing performance
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TPM
performance
© 2009 Shire Systems Limited
Take the lead!Take the lead!
Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details
ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance
You need to apply the Total You need to apply the Total Productive Maintenance framework to Productive Maintenance framework to achieve optimal manufacturing achieve optimal manufacturing performance performance
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TPMBut, expect to be lonely and sniped at! Your credibility is on the line and proper support is likely to be scarce - until you show them what success looks like
© 2009 Shire Systems Limited
Total Productive MaintenanceTotal Productive MaintenanceThe precondition of Lean manufacturingThe precondition of Lean manufacturing
© 2009 Shire Systems Limited
TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste
TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects
© 2009 Shire Systems Limited
TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste
TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects
TPMTPM’’s zeros zero--orientation is totally orientation is totally in line with the 7 Wastes in line with the 7 Wastes elimination of Lean elimination of Lean –– the the pursuit pursuit of perfectionof perfection
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TPM
© 2009 Shire Systems Limited
TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste
TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects
TPMTPM’’s zeros zero--orientation is totally orientation is totally in line with the 7 Wastes in line with the 7 Wastes elimination of Lean elimination of Lean –– the the pursuit pursuit of perfectionof perfection
TPM is not just in line with lean; TPM is not just in line with lean; itit’’s a s a precondition of leanprecondition of lean. TPM . TPM is essential for Lean is essential for Lean manufacturing to flourishmanufacturing to flourish
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TPM
1
2
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
there are more…
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TOTALPRODUCTIVE MAINTENANCE
See the book ‘Introduction to TPM’by Seiichi Nakajima
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
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TOTALPRODUCTIVE MAINTENANCE
These are the prerequisitesof performance
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
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TOTALPRODUCTIVE MAINTENANCE
Do these properly…
These are the prerequisitesof performance
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
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TOTALPRODUCTIVE MAINTENANCE
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© 2009 Shire Systems Limited
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TOTALPRODUCTIVE MAINTENANCE
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Operator or user maintenance!It’s great - but does depend on getting the co-operation of Management and others. If that’s not immediately forthcoming…
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
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TOTALPRODUCTIVE MAINTENANCE
Concentrate on these –you can control them
© 2009 Shire Systems Limited
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TOTALPRODUCTIVE MAINTENANCE
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Planning!
Planned preventive maintenancePLUS early detection and
planned prioritised repair of defects. 90% of work activity
should be ‘planned’
© 2009 Shire Systems Limited
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TOTALPRODUCTIVE MAINTENANCE
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Training!
Increases overall equipment availability by countering the ‘common cause’ failure of
human error. >3% of available manhours should be allocated. Note, 80% of the maintenance workload is usually due to
human acts and omissions. Training is not simply about giving information, its about
changing attitude and behaviour
© 2009 Shire Systems Limited
TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’
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TOTALPRODUCTIVE MAINTENANCE
Engineering!It’s design configuration that determines
equipment’s intrinsic capability, reliability and maintainability. While initial design is crucial, operational needs change and the equipment must respond - so allocate 5% of manhours to engineering modifications. And, roll over your engineering analyses of equipment into failure countermeasures – your PPM tasks
© 2009 Shire Systems Limited
Caution! Caution! Engineering and management science is Engineering and management science is indispensable indispensable –– but never lose sight of but never lose sight of
your equipmentyour equipment’’s s basic carebasic care needsneeds
© 2009 Shire Systems Limited
The basic care precondition The basic care precondition No asset abuse!No asset abuse!
© 2009 Shire Systems Limited
The basic care precondition The basic care precondition No asset abuse!No asset abuse!
LUB
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BASIC CARE
1
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ALL
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4
© 2009 Shire Systems Limited
The basic care precondition The basic care precondition
LUB
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3
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BASIC CARE
1
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4
No asset abuse!No asset abuse!
The prerequisites of successful maintenance and manufacturing performance. You’re going nowhere nice until these 4 conditions are substantially met
© 2009 Shire Systems Limited
The basic care precondition The basic care precondition
LUB
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BASIC CARE
1
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4
No asset abuse!No asset abuse!
WatchkeepingEquipment ChecklistCleaned
TightenedLubed
No unreported defects
© 2009 Shire Systems Limited
Performance managementPerformance managementGetting to gripsGetting to grips
© 2009 Shire Systems Limited
Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!
© 2009 Shire Systems Limited
Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!
However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement
© 2009 Shire Systems Limited
Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!
However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement
Fundamentally, the problem is one of information overload. You just can’t assimilate and process new information fast enough to get ahead. And yet you’re continually pressured to take instantaneous, well-considered decisions. Unfortunately, when developing events get ahead of your ‘thinking’, you just slide further into chaos…
© 2009 Shire Systems Limited
Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!
However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovementThere’s a general need to become better organised
© 2009 Shire Systems Limited
Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!
However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement
If you set up the means to drain If you set up the means to drain the swamp the swamp –– a a performance performance management systemmanagement system –– you can you can engage your crew in the program, engage your crew in the program, cull the alligators, gain control and cull the alligators, gain control and make your life a whole lot easier!make your life a whole lot easier!
© 2009 Shire Systems Limited
Performance managementPerformance management
The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance
© 2009 Shire Systems Limited
Performance managementPerformance management
The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance
Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them
© 2009 Shire Systems Limited
Performance managementPerformance management
The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance
Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them
Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement
© 2009 Shire Systems Limited
Performance managementPerformance management
The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance
Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them
Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement
Performance indicators promote visibility and Performance indicators promote visibility and alertness, together with organisationalertness, together with organisation--wide wide common purpose and agility common purpose and agility –– everyone sings everyone sings from the same hymn sheetfrom the same hymn sheet
© 2009 Shire Systems Limited
Performance managementPerformance management
The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance
Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them
Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement
Performance indicators promote visibility and Performance indicators promote visibility and alertness, together with organisationalertness, together with organisation--wide wide common purpose and agility common purpose and agility –– everyone sings everyone sings from the same hymn sheetfrom the same hymn sheet
You’ll need to do this if you’re thinking of
implementing PAS 55
© 2009 Shire Systems Limited
Performance indicatorsPerformance indicators
There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))
© 2009 Shire Systems Limited
Performance indicatorsPerformance indicators
There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))
1.1. Lagging indicatorsLagging indicators –– historical, quantified historical, quantified statements of fact. They measure results. statements of fact. They measure results. Generally, they respond slowly to changes in Generally, they respond slowly to changes in the workplacethe workplace
© 2009 Shire Systems Limited
Performance indicatorsPerformance indicators
There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))
1.1. Lagging indicatorsLagging indicators –– historical, quantified historical, quantified statements of fact. They measure results. statements of fact. They measure results. Generally, they respond slowly to changes in Generally, they respond slowly to changes in the workplacethe workplace
2.2. Leading indicatorsLeading indicators –– predictive of a desired predictive of a desired future state. They measure inputs. They have future state. They measure inputs. They have a much faster response to changes in the a much faster response to changes in the workplaceworkplace
© 2009 Shire Systems Limited
Performance indicatorsPerformance indicators
There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))
1.1. Lagging indicatorsLagging indicators
2.2. Leading indicatorsLeading indicators
Understanding the nature of the two types of indicators –
their limitations and advantages - is crucial to
the realisation of effective maintenance management
© 2009 Shire Systems Limited
Performance indicatorsPerformance indicators
There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))
1.1. Lagging indicatorsLagging indicators
2.2. Leading indicatorsLeading indicators
There tends to be a somewhat fruitless pre-occupation with lagging indicators. While they quantify business-related goals, for example OEE, they are in fact useless for controlling the day-to-day, real-time activities of maintenance…
© 2009 Shire Systems Limited
Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s
© 2009 Shire Systems Limited
Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s
They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worsegetting better or worse
© 2009 Shire Systems Limited
Lagging indicatorsLagging indicators
What do I do next?
Lagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s
They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worsegetting better or worse
But lagging indicators But lagging indicators provide no provide no clue about the underlying causes of clue about the underlying causes of a problem a problem –– or a successor a success
© 2009 Shire Systems Limited
Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s
They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worse getting better or worse
But lagging indicators But lagging indicators provide no provide no clue about the underlying causes of clue about the underlying causes of a problem a problem –– or a successor a success
Give me visibility!
Resulting actions are Resulting actions are corrective corrective and and reactive reactive –– largely based on blind largely based on blind guesswork! guesswork! Euphemistically known as intuitionEuphemistically known as intuition……
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicatorsleading indicators
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators
Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievement
AND
leading indicators
specific performance achievement
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators
Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievementspecific performance achievement
The relationship between the leading The relationship between the leading and lagging indicators is one of and lagging indicators is one of causecause--andand--effect
AND
leading indicators
effect
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators
Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievementspecific performance achievement
The relationship between the leading The relationship between the leading and lagging indicators is one of and lagging indicators is one of causecause--andand--effecteffect
The highest impact, The highest impact, critical fewcritical fewleading indicators should be chosen leading indicators should be chosen for each lagging indicator for each lagging indicator ––discarding the discarding the trivial many
AND
leading indicators
trivial many
© 2009 Shire Systems Limited
Leading indicatorsLeading indicators
Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors
© 2009 Shire Systems Limited
Leading indicatorsLeading indicators
MTB
F
MTT
R
OIF
D
OEE IFR
Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors
Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay
© 2009 Shire Systems Limited
Leading indicatorsLeading indicators
MTB
F
MTT
R
OIF
D
OEE IFR
Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors
Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay
The time delay provides space to reflect The time delay provides space to reflect on progress, adjust emphasis and take on progress, adjust emphasis and take definitive action. Resulting actions are definitive action. Resulting actions are therefore therefore preventivepreventive or or improvementimprovement
© 2009 Shire Systems Limited
Leading indicatorsLeading indicators
MTB
F
MTT
R
OIF
D
OEE IFR
Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors
Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay
The time delay provides space to reflect The time delay provides space to reflect on progress, adjust emphasis and take on progress, adjust emphasis and take definitive action. Resulting actions are definitive action. Resulting actions are therefore therefore preventivepreventive or or improvementimprovement
Without leading indicators, you canWithout leading indicators, you can’’t t prevent failure or properly action prevent failure or properly action improvements improvements –– youyou’’ll just be ll just be thrashing thrashing around in the darkaround in the dark
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practice
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etc
British Standard BS EN 15341,
Maintenance Key Performance Indicators
BESTPRACTICE MAKESPERFECT
Society for Maintenance & Reliability Professionals
BSI, SMRP, etc
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc
Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score
British Standard BS EN 15341,
Maintenance Key Performance Indicators
BESTPRACTICE MAKESPERFECT
Society for Maintenance & Reliability Professionals
keep the score
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc
Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score keep the score
British Standard BS EN 15341,
Maintenance Key Performance Indicators
BESTPRACTICE MAKESPERFECT
Society for Maintenance & Reliability Professionals
In essence, the current ‘reading’ of a leading indicator is a measure of the present success of the application of its associated best practice
© 2009 Shire Systems Limited
Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc
Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score keep the score
You may gain, but can never sustain, You may gain, but can never sustain, competitive business performance without competitive business performance without achieving the prerequisite level of achieving the prerequisite level of competency in each contributory best competency in each contributory best practice practice –– embedded embedded competency
British Standard BS EN 15341,
Maintenance Key Performance Indicators
BESTPRACTICE MAKESPERFECT
Society for Maintenance & Reliability Professionals
competency
© 2009 Shire Systems Limited
Your Dashboard of indicatorsYour Dashboard of indicators
Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem
© 2009 Shire Systems Limited
Your Dashboard of indicatorsYour Dashboard of indicators
Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem
The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard
© 2009 Shire Systems Limited
Your Dashboard of indicatorsYour Dashboard of indicators
Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem
The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard
Those with a late model AC Cobra will recognise this one…
© 2009 Shire Systems Limited
Your Dashboard of indicatorsYour Dashboard of indicators
Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem
The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard
Each indicator provides information on Each indicator provides information on a specific and crucial aspect of a a specific and crucial aspect of a systemsystem’’s health and performance s health and performance –– to to safeguard the system so it can safeguard the system so it can complete its mission successfullycomplete its mission successfully
© 2009 Shire Systems Limited
Your Dashboard of indicatorsYour Dashboard of indicators
Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem
The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard
Each indicator provides information on Each indicator provides information on a specific and crucial aspect of a a specific and crucial aspect of a systemsystem’’s health and performance s health and performance –– to to safeguard the system so it can safeguard the system so it can complete its mission successfullycomplete its mission successfully
Nevertheless, some individuals still run out of fuel and even blow up their engines! Success is not assured without prerequisite attentive and disciplined behaviour. Good practices and diligent behaviour remain paramount
© 2009 Shire Systems Limited
Relating all this to the maintenance Relating all this to the maintenance management processmanagement process
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
A A process process is a sequence of activities is a sequence of activities transforming inputs into outputs transforming inputs into outputs –– a a needed resultneeded result……
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTS
A A process process is a sequence of activities is a sequence of activities transforming inputs into outputs transforming inputs into outputs –– a a needed resultneeded result……
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTS
LabourParts & MaterialsToolsFacilitiesTechnical informationStandards & RegulationsManagement
The inputs and outputs of the Maintenance Management The inputs and outputs of the Maintenance Management process are well documented and undisputedprocess are well documented and undisputed……
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTSINPUTS
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTS
A lagging indicator of performance measures and reports a process output –
it’s a results measure
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTS
A lagging indicator of performance measures and reports a process output –
it’s a results measure
OEE, MTBF, MTTR, Accident Frequency, etc
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTS
But it presents you with a big dilemma -
How to act?
ActAct What?
How? Where?
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
INPUTS OUTPUTSBecause of the many influences
on output achievement, the lagging indicator won’t tell you
what corrective action is needed to control or improve the result
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTS
That’s dangerous!Events are outside of
your control – so calamities can occur
INPUTS
Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTS
CalamityINPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTS
CalamityThis is the reason why the Authorities impose Health, Safety and Environmental Regulations to make organisations think and plan more about what they’re doing
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTS
Calamity
The previous absence of a serious event cannot be taken as an indication and vindication that everything is well under control
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTS
Calamity
No matter what it is, when a credible event is totally unacceptable, senior management must ensure effective preventive controls are devised, put in place and are working
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
OUTPUTS
ActAct
MaintenanceManagement
A leading indicator of performance measures a specific process input and provides a trigger for definitive action…
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
ActAct
MaintenanceManagement
OUTPUTS
…enabling preventive, feedforward control of
the needed output
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
ActAct
MaintenanceManagement
OUTPUTS
it gives you time to assess the situation and take
preventive action to avoid an indicated developing problem
INPUTS
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTSINPUTS
Leading indicators are task-specific - so you need many of them!
ActAct
ActAct
ActAct
ActAct ActAct
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTSINPUTSActAct
ActAct
ActAct
ActAct ActAct
5 to 10 measuresBut strive to keep the number down to the critical few
© 2009 Shire Systems Limited
Maintenance performance managementMaintenance performance management
MaintenanceManagement
OUTPUTSINPUTSActAct
ActAct
ActAct
ActAct ActAct
5 to 10 measures
You are the controlling mind. Choice of your indictor set -your Dashboard - is critical. It must balance process complexity against your finite mental capacity to assess, plan and coordinate activities
© 2009 Shire Systems Limited
Aligning business goals and Aligning business goals and performance indicatorsperformance indicators
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goalsThe The Performance Performance PyramidPyramid model for model for integrated performance integrated performance management was first management was first proposed by Wang proposed by Wang Laboratories in the late Laboratories in the late 1980s
Quality
Flexibility(Agility)
MarketMeasures
CorporateVision
Delivery(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
CustomerSatisfaction Productivity
FinancialMeasures
Operations(Production, Maintenance, Logistics…)
1980s
With acknowledgement to Wang Laboratories
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goalsThe The Performance Performance PyramidPyramid model for model for integrated performance integrated performance management was first management was first proposed by Wang proposed by Wang Laboratories in the late Laboratories in the late 1980s1980s
The The business objectivesbusiness objectives–– as defined in the as defined in the Boardroom Boardroom –– are are deployed down and deployed down and across the organisation. across the organisation. Targets are derived & set Targets are derived & set for factors in each activity for factors in each activity contributing to success
Quality
Flexibility(Agility)
MarketMeasures
CorporateVision
Delivery(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
CustomerSatisfaction Productivity
FinancialMeasures
Operations(Production, Maintenance, Logistics…)
Depl
oym
ent
Depl
oym
ent
contributing to success With acknowledgement to Wang Laboratories
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
Quality
Flexibility(Agility)
MarketMeasures
CorporateVision
Delivery(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
CustomerSatisfaction Productivity
FinancialMeasures
Operations(Production, Maintenance, Logistics…)
Goals are cascaded down to the operational level
OEE>85%
Depl
oym
ent
Depl
oym
ent
With acknowledgement to Wang Laboratories
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
Quality
Flexibility(Agility)
MarketMeasures
CorporateVision
Delivery(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
CustomerSatisfaction Productivity
FinancialMeasures
Operations(Production, Maintenance, Logistics…)
Performance indicators roll upwards
Performance indicatorsPerformance indicatorsare the means of are the means of assuring operational assuring operational alignment with business alignment with business objectives. Theyobjectives. They’’re re reported up and across reported up and across the organisation
Delivery
Deliverythe organisation
With acknowledgement to Wang Laboratories
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
Quality
Flexibility(Agility)
MarketMeasures
CorporateVision
Delivery(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
CustomerSatisfaction Productivity
FinancialMeasures
Operations(Production, Maintenance, Logistics…)
With acknowledgement to Wang Laboratories
Performance indicators Performance indicators are the means of are the means of assuring operational assuring operational alignment with business alignment with business objectives. Theyobjectives. They’’re re reported up and across reported up and across the organisationthe organisation
Quality, Delivery, Quality, Delivery, Cycle TimeCycle Time and and Cost Cost are the performance are the performance characteristics of ALL characteristics of ALL operational activitiesoperational activities……
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
OperationsIn business, performance
indicators can be quantified for every operational activity,
including maintenance, in terms of these 4 basic characteristics
Enterprise goals
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
Operations
For example, First Time Through, Takt Time,
On Time In Full Delivery,Injury Frequency,
Production Rate, OEE, MTBF, Unit Cost…
Enterprise goals
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
Operations
If you can’t put a number on it, you can’t measure it – and, if
you can’t measure it, you can’t manage it. Trite but true!
Enterprise goals
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
Enterprise goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
Operations
The performance indicators monitor the most important
determinants of success and provide the stimulus for action
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
Enterprise goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
Operations
The purpose of measurement is to gain information on which to act – if no action, you're wasting your time and just throwing good money away after bad
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
OperationsIn manufacturing and other
equipment-intensive industries, maintenance provides the
prerequisite magic ingredient, assuring successful business
performance
Enterprise goals
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
OperationsAvailabilityAvailability CapabilityCapability
(Process) ComplianceCompliance CostCost(Lowest)
Enterprise goals
© 2009 Shire Systems Limited
Aligning performance with business goalsAligning performance with business goals
QualityDelivery
(Quantity & Timeliness)
Cost(Waste)
Cycle Time
(Process)
OperationsAvailabilityAvailability CapabilityCapability
(Process) ComplianceCompliance CostCost(Lowest)
Enterprise goals
Maintenance delivers these essential conditions - the
prerequisites of manufacturing competitiveness and success
© 2009 Shire Systems Limited
Leading indicators of Leading indicators of maintenance performancemaintenance performance
© 2009 Shire Systems Limited
AND
OEE, MTBF, MTTR…
There are many influences There are many influences on maintenance performanceon maintenance performance
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
…more
Cost(Lowest)
Compliance
Capability(Process)
Availability
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework
British Standard BS EN 15341
Maintenance Key Performance Indicators
AN
D
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
Cost(Lowest)
Compliance
Capability(Process)
Availability
…more
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework
These are ‘big hitter’indicators applying to MTBF, MTTR - and
hence OEEA
ND
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
Cost(Lowest)
Compliance
Capability(Process)
Availability
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more
For leading indicators, the questions to ask are: which factors (influencers, drivers) push the system to a new
desired state? Which factors are worth monitoring?
AN
D
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
Cost(Lowest)
Compliance
Capability(Process)
Availability
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more
AN
D
Because the greatest potential for control exists at the point of action, ‘self control’ by the individual on the spot tends is ultimately the most effective control. The best leading indicators are therefore those which aid self control. This is the reason why all individuals
involved in a process must clearly understand why their contribution is
important and how it contributes to success
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
Cost(Lowest)
Compliance
Capability(Process)
Availability
British Standard BS EN 15341
Maintenance Key Performance Indicators
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more
Most of these and others are defined in the 2007
British Standard
AN
D
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
Cost(Lowest)
Compliance
Capability(Process)
Availability
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
British Standard BS EN 15341
Maintenance Key Performance Indicators
AN
D
In addition, you can refer to the Whitepaper
section of the Shire Systems website
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performance
…more
British Standard BS EN 15341
Maintenance Key Performance Indicators
Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework
MTBFMTBF
MTTRMTTR++ A
ND
Use of a CMMS is also a stated BSI leading indicator of maintenance performance
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performanceRisk analysis BSI T18Planning BSI T19Operator maintenance BSI O4
Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Condition-based maintenance BSI O19
Training ratio BSI O23Response timeBacklogManpower utilisationRework
Planned & scheduled work BSI O5Planned & scheduled work BSI O5
Preventive maintenance BSI O18Preventive maintenance BSI O18
Schedule compliance BSI O22Schedule compliance BSI O22
Planning is pre-eminent!
…more
AN
DMTBFMTBF
MTTRMTTR++
© 2009 Shire Systems Limited
Leading indicators of maintenance performanceLeading indicators of maintenance performanceRisk analysis BSI T18Planning BSI T19Operator maintenance BSI O4
Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17
Condition-based maintenance BSI O19
Training ratio BSI O23Response timeBacklogManpower utilisationRework
Planned & scheduled work BSI O5Planned & scheduled work BSI O5
Preventive maintenance BSI O18Preventive maintenance BSI O18
Schedule compliance BSI O22Schedule compliance BSI O22
…more
AN
D
Besides the huge cost savings, sticking to plan
reduces turbulence, creates order, eases personnel
tension and stabilises morale
MTBFMTBF
MTTRMTTR++
© 2009 Shire Systems Limited
Getting goingGetting going
© 2009 Shire Systems Limited
The two main aspects of performanceThe two main aspects of performance
For startersFor starters, evaluate two main aspects of , evaluate two main aspects of your maintenance performanceyour maintenance performance
First, improvements in equipment First, improvements in equipment reliability, maintainability and capability to reliability, maintainability and capability to increase plant effectiveness and product increase plant effectiveness and product qualityquality
Second, improvement in the efficiency of Second, improvement in the efficiency of maintenance work itself. All work must be maintenance work itself. All work must be carried out using the best, most carried out using the best, most economical methods economical methods –– and your and your technicians should maximise the amount technicians should maximise the amount of time they spend wielding tools for gain of time they spend wielding tools for gain
© 2009 Shire Systems Limited
Performance management questionsPerformance management questions
And ask yourselfAnd ask yourself
WhatWhat’’s causing me and my organisation the most s causing me and my organisation the most pain? List the ten biggest issues you are involved in pain? List the ten biggest issues you are involved in and establish their underlying patternsand establish their underlying patterns
1.1. What are am I doing right?What are am I doing right?
2.2. What do I need to improve?What do I need to improve?
3.3. What do I need to start doing?What do I need to start doing?
4.4. What do I need to stop doing?What do I need to stop doing?
© 2009 Shire Systems Limited
Select the Critical Few indicatorsSelect the Critical Few indicators
Choose a Choose a ‘‘handfulhandful’’ of highof high--impact indicators to get impact indicators to get going with, say 5 going with, say 5 -- for examplefor example
1.1. Planned & scheduled workPlanned & scheduled work
2.2. Preventive MaintenancePreventive Maintenance
3.3. Schedule complianceSchedule compliance
4.4. Response timeResponse time
5.5. Rework rateRework rate
© 2009 Shire Systems Limited
The contribution of The contribution of information management information management systems systems –– your CMMSyour CMMS……
© 2009 Shire Systems Limited
The essential contribution of CMMSThe essential contribution of CMMS
To get the information outputs needed for performance To get the information outputs needed for performance management, you must have the right data inputs. management, you must have the right data inputs. Common sense!Common sense!
Good data collection and analysis are key requirements Good data collection and analysis are key requirements for a successful systemfor a successful system
ThereThere’’s a morass of data to slice, dice and process in s a morass of data to slice, dice and process in order to obtain pertinent, usable performance order to obtain pertinent, usable performance informationinformation
Accounting systems are not definitive enough to handle Accounting systems are not definitive enough to handle the detail required. The breakdown and tracking can the detail required. The breakdown and tracking can only be done by the Work Order system within a CMMSonly be done by the Work Order system within a CMMS
A CMMS can also help you to enforce data discipline A CMMS can also help you to enforce data discipline with userwith user--prompts and mandatory fieldsprompts and mandatory fields
© 2009 Shire Systems Limited
Lean is about the elimination of Lean is about the elimination of waste waste –– so only collect and process so only collect and process the the minimum dataminimum data to satisfy your to satisfy your performance information needs. performance information needs.
That is, data for immediate needs That is, data for immediate needs andand, , IDEALLY, for the medium term IDEALLY, for the medium term --because because longer term needs will longer term needs will undoubtedly have current data undoubtedly have current data collection requirementscollection requirements
© 2009 Shire Systems Limited
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
CMMS
Compliance & Performance Monitoring & Control information
Codes, Standards & Regulations
© 2009 Shire Systems Limited
Compliance & Performance Monitoring & Control information
R
is
k
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
CMMS
Codes, Standards and
RegulationsThe management of
maintenance is fundamentally about
the mitigation of business risk
© 2009 Shire Systems Limited
Compliance & Performance Monitoring & Control information
R
is
k
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
CMMS
Codes, Standards and
Regulations
Using a Work Order system with the workflow steps – Approve, Plan, Schedule and Launch
© 2009 Shire Systems Limited
Compliance & Performance Monitoring & Control information
R
is
k
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
CMMS
Besides the workflow steps, Work
Management is complex because it
involves many divers sub-processes…
Codes, Standards & Regulations
© 2009 Shire Systems Limited
R
is
k
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
Compliance & Performance Monitoring & Control information
CMMS
Service Management
ContractManagement
Labour Management
Materials Management
Purchasing Management
FinancialManagement
SHE Compliance
Warranties,Waste, etc
Defect Management
Codes, Standards & Regulations
more…
© 2009 Shire Systems Limited
Compliance & Performance Monitoring & Control information
Codes, Standards & Regulations
R
is
k
The essential contribution of CMMSThe essential contribution of CMMS
Technical Management
Asset Technical & Economic Data
Work Management
Business Objectives
CMMS
Service Management
ContractManagement
Labour Management
Materials Management
Purchasing Management
FinancialManagement
SHE Compliance
Warranties,Waste, etc
Defect ManagementThis lies at the heart of
maintenance - but is often completely overwhelmed by the many other distracting, but lesser, considerations
more…
© 2009 Shire Systems Limited
Data collection, slicing and dicingData collection, slicing and dicing
WorkloadWorkload
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying your workloadclassifying your workload
Preventive Maintenance
Predictive Inspection
&Testing
Programmed Maintenance
(cycle> 1year)
Grounds Care
Corrective Repairs
(Emergency & Routine)
Service Requests
(Non-Maintenance)
Replacementof Obsolete
Items
Minor Modifications
Rehabilitation&
Modernisation
Additions &
Major Alterations
Total Workload
It is essential that the total Workload is carefully divided into categories to facilitate its technical and
economic control
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying your workloadclassifying your workload
Preventive Maintenance
Predictive Inspection
&Testing
Programmed Maintenance
(cycle> 1year)
Grounds Care
Corrective Repairs
(Emergency & Routine)
Service Requests
(Non-Maintenance)
Replacementof Obsolete
Items
Minor Modifications
Rehabilitation&
Modernisation
Additions &
Major Alterations
According to your needs, there can be other Work Types
…more
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying your workloadclassifying your workload
Preventive Maintenance
Predictive Inspection
&Testing
Programmed Maintenance
(cycle> 1year)
Grounds Care
Corrective Repairs
(Emergency & Routine)
Service Requests
(Non-Maintenance)
Replacementof Obsolete
Items
Minor Modifications
Rehabilitation&
Modernisation
Additions &
Major Alterations
It’s got to work for you!
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying your workloadclassifying your workload
Preventive Maintenance
Predictive Inspection
&Testing
Programmed Maintenance
(cycle> 1year)
Grounds Care
Corrective Repairs
(Emergency & Routine)
Service Requests
(Non-Maintenance)
Replacementof Obsolete
Items
Minor Modifications
Rehabilitation&
Modernisation
Additions &
Major Alterations
It’s got to work for you!
You can add new Work Types at any time - but when there’s no existing data, your
system will not be able to present you with associated historical trends. Hence, while focusing on immediate imperatives, it’s best to try to foresee and provide for
your future information needs into the 2 to 3 year term
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying your workloadclassifying your workload
Preventive Maintenance
Predictive Inspection
&Testing
Programmed Maintenance
(cycle> 1year)
Grounds Care
Corrective Repairs
(Emergency & Routine)
Service Requests
(Non-Maintenance)
Minor Modifications
Rehabilitation&
Modernisation
Additions &
Major Alterations
CMMSReplacementof Obsolete
Items
It’s easy to set up, track and control as many Work Types as you need in your CMMS
© 2009 Shire Systems Limited
Data collection, slicing and dicingData collection, slicing and dicing
MaterialsMaterials
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying materialsclassifying materials
Common spares
Refurbishable spares
Plant spares
Plant consumables
Insurance spares
Engineers supplies
Maintenance consumables
General supplies
Tools & Instruments
Project materials
Surplus materials
Lubricants
Total materials movements and inventories (Stores
Stock) must be divided up to facilitate technical and
economic control
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying materialsclassifying materials
Common spares
Refurbishable spares
Plant spares
Plant consumables
Insurance spares
Engineers supplies
Maintenance consumables
General supplies
Tools & Instruments
Project materials
Surplus materials
Lubricants
Control and optimisation of stores value (Working Capital) requires targets to be set and values monitored for stock holding with different ‘movement’characteristics - fast moving (<< I year),slow moving (> 1 year), insurance and surplus materials
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying materialsclassifying materials
Common spares
Refurbishable spares
Plant spares
Plant consumables
Insurance spares
Engineers supplies
Maintenance consumables
General supplies
Tools & Instruments
Project materials
Surplus materials
Lubricants
CMMS
It’s easy to set up, track and control multiple
Material Types, movement categories and storage locations in your CMMS
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– classifying materialsclassifying materials
Common spares
Refurbishable spares
Plant spares
Plant consumables
Insurance spares
Engineers supplies
Maintenance consumables
General supplies
Tools & Instruments
Project materials
Surplus materials
Lubricants
CMMS
It’s easy to set up, track and control multiple
Material Types, movement categories and storage locations in your CMMS
It’s got to work for you!
© 2009 Shire Systems Limited
Data collection, slicing and dicingData collection, slicing and dicing
Asset IndentureAsset Indenture
© 2009 Shire Systems Limited
An element of a Part – of importance in failure reporting only
Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture LevelsConglomerate
Company
Site
Area
Unit
System (Cell)
Asset
Assembly
Sub-assembly
Part
Location hierarchy
System hierarchy
Sub-Unit
Element
geographical
assembly
……your your ‘‘Assets TreeAssets Tree’’
Where?
What?
© 2009 Shire Systems Limited
Location hierarchygeographical
Conglomerate
Company
Site
Area
Unit
System (Cell)
Asset
Assembly
Sub-assembly
Part
Sub-Unit
Element
System hierarchyassembly
An element of a Part – of importance in failure reporting only. For instance, a gear tooth
Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels……your your ‘‘Assets TreeAssets Tree’’
The number of geographical and assembly Indenture Levels needed depends on the size of your organisation, its industrial sector, your own maintenance strategy - and your organisation’s maintenance maturity
© 2009 Shire Systems Limited
Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels
Location hierarchygeographical
Conglomerate
Company
Site
Area
Unit
System (Cell)
Asset
Assembly
Sub-assembly
Part
Sub-Unit
Element
System hierarchyassembly
CMMS
It’s easy to set up, track, control and consolidate
as many Asset Indenture Levels as you
like in your CMMS
An element of a Part – of importance in failure reporting only
© 2009 Shire Systems Limited
Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels
Location hierarchygeographical
Conglomerate
Company
Site
Area
Unit
System (Cell)
Asset
Assembly
Sub-assembly
Part
Sub-Unit
Element
System hierarchyassembly
CMMS
It’s easy to set up, track, control and consolidate
as many Asset Indenture Levels as you
like in your CMMS
It’s got to work for you!
An element of a Part – of importance in failure reporting only
© 2009 Shire Systems Limited
Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture LevelsConglomerate
Company
Site
Area
Unit
System (Cell)
Asset
Assembly
Sub-assembly
Part
Sub-Unit
Element
Location hierarchygeographical
System hierarchyassembly
An element of a Part – of importance in failure reporting only
CMMS
These also link into the materials management
component of your CMMS
© 2009 Shire Systems Limited
Data collection, slicing and dicingData collection, slicing and dicing
Failures and FaultsFailures and Faults
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
A Failure is an event
A Fault is a state
© 2009 Shire Systems Limited
Following a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
Slice & dice Slice & dice –– Failures and FaultsFailures and Faults
e.g.
Conveyor trips out on overload
e.g.
Renewed bearing, seals and oil
Notes:
Logged as a Temporary Repair - helical wheel damaged and no spare available. On order, delivery 10 days max
e.g.
Motor gearbox
e.g.
Bearing seized
e.g.
Pile-up Conveyor Line 2
FAULT
Failure
FaultArea
FaultMode
FaultAction
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
CMMS
It’s easy to categorise, log and
analyse all plant failures and actions
in your CMMS
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
CMMS
Standard ‘libraries’ can be defined in the CMMS for all these - to
provide a structured framework, add engineering ‘intelligence’ and
speed up data capture and analysis
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
CMMS
Standard ‘libraries’ can be defined in the CMMS for all these - to
provide a structured framework, add engineering ‘intelligence’ and
speed up data capture and analysis
It’s got to work for you!
© 2009 Shire Systems Limited
Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……
FAULT
Failure
FaultArea
FaultMode
FaultAction
CMMS
Note: Failures (breakdowns) are lagging indicators of performance. They invariably have systemic root causes. Therefore, focus on the leading performance indicators driving the elimination of these disruptive events -obviously the same ones as for MTBF!
© 2009 Shire Systems Limited
In summaryIn summary
Because of its direct impact on equipment capacity Because of its direct impact on equipment capacity and capability and capability -- its transforming potential on product its transforming potential on product quality, safety and production costs, maintenance is quality, safety and production costs, maintenance is a high leverage contributor to business a high leverage contributor to business competitiveness and profitabilitycompetitiveness and profitability
Costs are important, but a prime emphasis on Costs are important, but a prime emphasis on maintenance costmaintenance cost--cutting will not lead to sustainable cutting will not lead to sustainable business performance improvementbusiness performance improvement
Investing in plant reliability and utilisation Investing in plant reliability and utilisation improvement carries with it the promise that, along improvement carries with it the promise that, along with product quality, production capacity and safety, with product quality, production capacity and safety, costs will automatically decrease as a resultcosts will automatically decrease as a result
© 2009 Shire Systems Limited
In summaryIn summary
The byThe by--product of better planning and less repairs is product of better planning and less repairs is lower maintenance expense. And there will be more lower maintenance expense. And there will be more production for no extra capital cost, as the hidden production for no extra capital cost, as the hidden factory comes on streamfactory comes on stream
To survive the recession, being good just isnTo survive the recession, being good just isn’’t good t good enough enough –– youyou’’ll have to be excellent. To be excellent, ll have to be excellent. To be excellent, youyou’’ve got to drive increased performance using a ve got to drive increased performance using a slick performance management system slick performance management system –– you need a you need a wellwell--configured CMMSconfigured CMMS
The Engineering Manager has to lead the way for all The Engineering Manager has to lead the way for all these things to happenthese things to happen
© 2009 Shire Systems Limited
This is the end of the This is the end of the Maintec 2009 presentation Maintec 2009 presentation
If youIf you’’re interested in more re interested in more reflections on performance reflections on performance indicators, please read onindicators, please read on……
© 2009 Shire Systems Limited
Why performance Why performance indicators are neededindicators are needed
© 2009 Shire Systems Limited
Why we need performance indicatorsWhy we need performance indicators
Corporate strategy and goals are usually too abstract Corporate strategy and goals are usually too abstract –– too woollytoo woolly-- to guide managers and others in their dayto guide managers and others in their day--toto--day decisions and day decisions and actionsactions
Performance indicators, particularly leading indicators, make Performance indicators, particularly leading indicators, make abstract strategy more understandable and relatable. The abstract strategy more understandable and relatable. The translation of corporate vision into clearly defined workplace translation of corporate vision into clearly defined workplace practices and hard measures practices and hard measures -- deployment deployment -- enables individuals enables individuals to understand their required contribution and take the local, onto understand their required contribution and take the local, on--thethe--spot action necessary to achieve corporate goalsspot action necessary to achieve corporate goals
Fundamentally, performance measures are deployed to influence Fundamentally, performance measures are deployed to influence and change behaviours for the better on the factory floor and inand change behaviours for the better on the factory floor and inoffice suites. They act to align attitudes and actions with office suites. They act to align attitudes and actions with organisational needs. Performance indicators get everyone organisational needs. Performance indicators get everyone signing for the same hymn sheet; they have a positive effect on signing for the same hymn sheet; they have a positive effect on individual behaviour; they foster advantageous peerindividual behaviour; they foster advantageous peer--pressurepressure
© 2009 Shire Systems Limited
Why we need performance indicatorsWhy we need performance indicators
The effective use of leading performance indicators takes the The effective use of leading performance indicators takes the guesswork out of managing a complex process. Without the guesswork out of managing a complex process. Without the necessary understanding of underlying process dynamics that the necessary understanding of underlying process dynamics that the leading indicator thoughtleading indicator thought--process brings, the only alternative is to process brings, the only alternative is to make assumptions and rely on luck. Rational, factmake assumptions and rely on luck. Rational, fact--based decisionbased decision--making is a much better approach than thrashing around in the making is a much better approach than thrashing around in the darkdark
Business process and procedural improvements have traditionally Business process and procedural improvements have traditionally been implemented as a result of investigations triggered by been implemented as a result of investigations triggered by customer complaints, accidents and other mishaps. Progress has customer complaints, accidents and other mishaps. Progress has been based on the highlybeen based on the highly--favoured reactive management model of: favoured reactive management model of: First the incident, then the corrective actionFirst the incident, then the corrective action -- a a ‘‘learning from learning from failurefailure’’ approach. This approach flourishes in industry and has approach. This approach flourishes in industry and has been recently updated with the new been recently updated with the new ‘‘Lessons LearnedLessons Learned’’ addition to addition to project management practice!project management practice!
© 2009 Shire Systems Limited
Why we need performance indicatorsWhy we need performance indicators
The traditional, backwardThe traditional, backward--looking approach uses lagging indicators looking approach uses lagging indicators to monitor performance. The big concern is that these indicatorsto monitor performance. The big concern is that these indicators DO DO NOT provide the requisite management information and insight to NOT provide the requisite management information and insight to prevent future untoward eventsprevent future untoward events
ItIt’’s clearly evident that the previous absence of an untoward events clearly evident that the previous absence of an untoward event is is not necessarily an indication and vindication that all is honky not necessarily an indication and vindication that all is honky dory dory and activities are under effective control and activities are under effective control –– while there may well be while there may well be historical patterns,historical patterns, the future is always different from the pastthe future is always different from the past
The reactive approach is not acceptable where health and safety The reactive approach is not acceptable where health and safety are concerned. are concerned. Prevention is keyPrevention is key. The Government has stepped in . The Government has stepped in over the years with Regulations to make organisations think and over the years with Regulations to make organisations think and plan more about what theyplan more about what they’’re doing. Often judged as onerous by re doing. Often judged as onerous by some managements, the proactive, best practice approach sought some managements, the proactive, best practice approach sought by the authorities is by the authorities is –– naively perhaps naively perhaps -- not always applied to not always applied to managing performance in other areas of the businessmanaging performance in other areas of the business
© 2009 Shire Systems Limited
Why we need performance indicatorsWhy we need performance indicators
Legislation and regulatory requirements Legislation and regulatory requirements -- compliancecompliance -- define the define the organisationorganisation’’s minimum acceptable performances minimum acceptable performance
These compliance basics are not negotiable by senior These compliance basics are not negotiable by senior management. management. Regulatory measures therefore provide you, the Regulatory measures therefore provide you, the Engineering Manager, with the power base to leverage Engineering Manager, with the power base to leverage maintenance advantage and build on the established maintenance advantage and build on the established compliance practices to apply good sense and increase compliance practices to apply good sense and increase operational performance overalloperational performance overall
© 2009 Shire Systems Limited
The characteristics of good The characteristics of good performance indicatorsperformance indicators
© 2009 Shire Systems Limited
Characteristics of good performance indicatorsCharacteristics of good performance indicators
To be effective, performance indicators shouldTo be effective, performance indicators should……
1.1. Be timely, objective and unambiguous Be timely, objective and unambiguous -- easy easy to understandto understand
2.2. Be accepted, owned and under the control of Be accepted, owned and under the control of the maintenance team and other individuals the maintenance team and other individuals able to directly influence performance on the able to directly influence performance on the day, on the hourday, on the hour
3.3. Provide immediate and reliable indications of Provide immediate and reliable indications of the present level of performance against the the present level of performance against the predefined targets and any trend in predefined targets and any trend in improvement or deterioration improvement or deterioration –– operational operational maintenance is essentially a realmaintenance is essentially a real--time activity time activity needing realneeding real--time information feedbacktime information feedback
© 2009 Shire Systems Limited
Characteristics of good performance indicatorsCharacteristics of good performance indicators
4.4. Provide information that can clearly guide Provide information that can clearly guide and drive appropriate action to improve and drive appropriate action to improve performanceperformance
5.5. Respond sensitively to the work and Respond sensitively to the work and procedural changes made to influence itprocedural changes made to influence it
6.6. Be easy to measure and collect. It should Be easy to measure and collect. It should be cost efficient in terms of the personal be cost efficient in terms of the personal effort and equipment required to gather and effort and equipment required to gather and process the data. process the data. Ideally, data should be Ideally, data should be gathered in the normal course of gathered in the normal course of maintenance task planning and maintenance task planning and execution execution -- and processed in a CMMS and processed in a CMMS
© 2009 Shire Systems Limited
Performance indicator Performance indicator implementation processimplementation process
© 2009 Shire Systems Limited
Performance indicator implementation processPerformance indicator implementation process
Start with situational analysis. Referencing corporate vision, mStart with situational analysis. Referencing corporate vision, mission ission and goals, list the ten biggest issues you are facing. Establishand goals, list the ten biggest issues you are facing. Establish their their underlying patterns underlying patterns –– you will undoubtedly find common causal factorsyou will undoubtedly find common causal factors
Deduce and affirm the headline lagging performance indicators Deduce and affirm the headline lagging performance indicators –– the the success factors on which the achievement of corporate goals depesuccess factors on which the achievement of corporate goals depend nd –– MTBF, MTTR, OEE, Accident FrequencyMTBF, MTTR, OEE, Accident Frequency……
For each lagging indicator, identify the associated leading indiFor each lagging indicator, identify the associated leading indicators cators and their and their best practicesbest practices
The number of leading performance indicators that could be potenThe number of leading performance indicators that could be potentially tially useful is far too large for any organisation to contemplate usinuseful is far too large for any organisation to contemplate using them g them all. Individuals would just be overwhelmed and the organisation all. Individuals would just be overwhelmed and the organisation could could become gridbecome grid--locked with informationlocked with information
ItIt’’s paramount that you home in on the most valuable indicators s paramount that you home in on the most valuable indicators –– the the Vital Few Vital Few -- those presenting the greatest threat to business those presenting the greatest threat to business performance or opportunity for improvementperformance or opportunity for improvement
© 2009 Shire Systems Limited
Performance indicator implementation processPerformance indicator implementation process
Apply the Pareto Principle Apply the Pareto Principle –– the 80/20 rule. the 80/20 rule. ““In any population that In any population that contributes to a common effect, a relative few of the contributocontributes to a common effect, a relative few of the contributors rs –– the the vital few vital few –– account for the bulk of the effectaccount for the bulk of the effect””
Performance indicators are tools to aid the fixing of real and pPerformance indicators are tools to aid the fixing of real and present resent problems problems –– for alleviating pain. If they do not generate the right for alleviating pain. If they do not generate the right questions, then theyquestions, then they’’re a waste of time. Collecting data which has no re a waste of time. Collecting data which has no clear connection to clear connection to dailydaily events has no value. Obscure measures are events has no value. Obscure measures are not relatable and so theynot relatable and so they’’re effectively useless. Home in on factors re effectively useless. Home in on factors that measure pain directly and are most relatable to the workforthat measure pain directly and are most relatable to the workforce, so ce, so they they ‘‘get itget it’’
Quantify the medium term goal for each indicator selected and seQuantify the medium term goal for each indicator selected and set its t its long term and immediate short term targetslong term and immediate short term targets
On the improvement journey, your initial and intermediate goals On the improvement journey, your initial and intermediate goals must must be realistic and relatable be realistic and relatable -- so they excite interest and elicit continuing so they excite interest and elicit continuing commitment commitment
© 2009 Shire Systems Limited
Performance indicator implementation processPerformance indicator implementation process
Strive to set goals that force your organisation to Strive to set goals that force your organisation to ‘‘stretchstretch’’ to exceed to exceed its past performance its past performance -- but donbut don’’t stretch it to the limit! While the 100% t stretch it to the limit! While the 100% perfection aim of Lean is an admirable ideal to pursue, itperfection aim of Lean is an admirable ideal to pursue, it’’s a s a practical impossibility practical impossibility -- human fallibility and frailty are constraints in human fallibility and frailty are constraints in every endeavour. A zeroevery endeavour. A zero--tolerance acceptance of subtolerance acceptance of sub--optimal optimal conditions is fine, but zeroconditions is fine, but zero--tolerance for human error can undermine tolerance for human error can undermine morale by making goals appear unattainablemorale by making goals appear unattainable
Aim for perfection and settle for excellence. When you aim for tAim for perfection and settle for excellence. When you aim for the he adequate, the result is likely to be mediocrity. This is why theadequate, the result is likely to be mediocrity. This is why the ‘‘zerozero--basedbased’’ thinking of TPM and Lean is so motivating and compellingthinking of TPM and Lean is so motivating and compelling
When a performance standard is achieved for an indicator, reset When a performance standard is achieved for an indicator, reset the the target to a higher standard. The actionable leading performance target to a higher standard. The actionable leading performance indicators will change over time in accordance with your indicators will change over time in accordance with your organisationorganisation’’s maturity and increasing sophistication of its s maturity and increasing sophistication of its management processes, so you must review them periodicallymanagement processes, so you must review them periodically
© 2009 Shire Systems Limited
Performance indicator implementation processPerformance indicator implementation processA performance measure should be deemphasised once the target A performance measure should be deemphasised once the target performance level has been achieved performance level has been achieved -- the organisation can then move on the organisation can then move on to realising its next goal and stepto realising its next goal and step--change initiative. Adjust necessary action change initiative. Adjust necessary action plans and select the next threats and opportunities to be addresplans and select the next threats and opportunities to be addressed in the sed in the continuous improvement processcontinuous improvement process
A precondition of A precondition of ‘‘moving onmoving on’’ is that the changed behaviours bringing about is that the changed behaviours bringing about success have become ingrained in the organisation. Without the nsuccess have become ingrained in the organisation. Without the new ew behaviours being embedded and fixed behaviours being embedded and fixed –– a permanent cultural shifta permanent cultural shift -- the the gains wongains won’’t be sustained t be sustained
Publish a tracking chart of progress at least monthly Publish a tracking chart of progress at least monthly -- provide visibility to provide visibility to whole plant. Employees often downplay and even openly ridicule twhole plant. Employees often downplay and even openly ridicule the he significance of progress whilst actually taking quiet pride in tsignificance of progress whilst actually taking quiet pride in their successheir success
Performance management is an iterative process and the overall oPerformance management is an iterative process and the overall objectives bjectives must be kept under continual reviewmust be kept under continual review
Continually reContinually re--engineer to add more value. You will never reach perfection engineer to add more value. You will never reach perfection but, for a manufacturer, the harsh reality is: but, for a manufacturer, the harsh reality is: ‘‘stop trying stop trying -- start dyingstart dying’’
© 2009 Shire Systems Limited
Performance improvement cycle
Act
BUSINESS PERFORMANCE PLANAssess
Review KPIs
Reset KPIs
Identify
perform
ance
elemen
ts
MAINTENANCE PERFORMANCE PLAN
Identify
Best P
ractic
e
(Ben
chmark
)Set
objectiv
es
Set KPIs
Continually assess, re-engineer and ACT to add more value…
Re-engineer
Kick off
© 2009 Shire Systems Limited
Particular considerationsParticular considerations•• Lean information managementLean information management
•• Human errorHuman error
•• BenchmarkingBenchmarking
© 2009 Shire Systems Limited
Information management and LeanInformation management and LeanLean principles apply not just to shopfloor activities but to Lean principles apply not just to shopfloor activities but to information management information management
Piling up large inventories of products is clearly poor practicePiling up large inventories of products is clearly poor practiceand the same is true for information and the same is true for information –– especially when youespecially when you’’re re piling up garbage in the mistaken belief that itpiling up garbage in the mistaken belief that it’’s valuable. You s valuable. You ignore garageignore garage--inin--garbagegarbage--out counselling at your perilout counselling at your peril
Make sure the failure and job history details you keep are Make sure the failure and job history details you keep are accurate and useable accurate and useable -- and fit for present and future purposeand fit for present and future purpose
Ensure the information you historise can be sliced and diced, soEnsure the information you historise can be sliced and diced, soitit’’s able to give up its inner secrets when you eventually get to s able to give up its inner secrets when you eventually get to query itquery it
Take care! The devil is in the detail, so make sure thereTake care! The devil is in the detail, so make sure there’’s s sufficient granularity built into your basic data to answer all sufficient granularity built into your basic data to answer all those those future questions you will undoubtedly have at some point down future questions you will undoubtedly have at some point down the roadthe road
© 2009 Shire Systems Limited
Human error and LeanHuman error and LeanHuman error is a huge problem in maintenance Human error is a huge problem in maintenance –– just as it is in all just as it is in all processes relying on the timely, appropriate and attentive inputprocesses relying on the timely, appropriate and attentive input of a of a human being, especially the safetyhuman being, especially the safety--critical activitiescritical activities
Human error of one sort or another is typically the cause of 80%Human error of one sort or another is typically the cause of 80% of an of an organisationorganisation’’s maintenance workload s maintenance workload –– letlet’’s face it, that does add s face it, that does add insult to injury as far as the business is concernedinsult to injury as far as the business is concerned
Human error is also the root cause of ALL of engineeringHuman error is also the root cause of ALL of engineering--related related disastersdisasters
Nevertheless, in a Lean environment, people are not viewed as thNevertheless, in a Lean environment, people are not viewed as the e problems, but as the problemproblems, but as the problem--solvers. The nosolvers. The no--blame culture does not blame culture does not mean that human error is condoned. Human fallibility is acceptedmean that human error is condoned. Human fallibility is accepted as a as a fact of life and creative strategies are encouraged and applied fact of life and creative strategies are encouraged and applied to to mitigate both its causes and effectsmitigate both its causes and effects
© 2009 Shire Systems Limited
Benchmarking and LeanBenchmarking and LeanLearning only from our own most current experience Learning only from our own most current experience --disregarding the lessons of history and the experience of othersdisregarding the lessons of history and the experience of others ––will result in a host of avoidable mistakes costing the organisawill result in a host of avoidable mistakes costing the organisation tion a great deal in terms of money and grief. Ita great deal in terms of money and grief. It’’s an heroic but stupid s an heroic but stupid strategy. It will never make you a winner in the 21st century strategy. It will never make you a winner in the 21st century because because winners usewinners use benchmark best practicesbenchmark best practices
Xerox, who Xerox, who ‘‘inventedinvented’’ benchmarking, define it as: benchmarking, define it as: ““the continuous the continuous process of measuring our products, services and business process of measuring our products, services and business practices against the toughest competition and those companies practices against the toughest competition and those companies recognised as industry leadersrecognised as industry leaders””
The idea is to use and build on the ideas and experience of the The idea is to use and build on the ideas and experience of the bestbest--ofof--thethe--best best –– you leverage their valuable, proven learning to you leverage their valuable, proven learning to improve your own performance. Now what could be more Lean improve your own performance. Now what could be more Lean than that? than that?
© 2009 Shire Systems Limited
Single points of adviceSingle points of adviceTaglines to keep in mindTaglines to keep in mind……
© 2009 Shire Systems Limited
Taglines to keep in mindTaglines to keep in mindJust get goingJust get going. Don. Don’’t let the pursuit of perfection overwhelm t let the pursuit of perfection overwhelm you and get in the way of becoming just a wee bit better todayyou and get in the way of becoming just a wee bit better today
Recurring problems are systems problemsRecurring problems are systems problems. Because . Because systemic problems result in a multitude of common cause systemic problems result in a multitude of common cause failures, itfailures, it’’s well worth tracking their roots well worth tracking their root--causes to ground causes to ground and dealing with them as a priorityand dealing with them as a priority
Focus on the critical fewFocus on the critical few. There. There’’s a tendency to start a new s a tendency to start a new program with too many performance indicatorsprogram with too many performance indicators
Maintain a sense of urgencyMaintain a sense of urgency. Performance management will . Performance management will not work when therenot work when there’’s lethargy. Solve todays lethargy. Solve today’’s problems today s problems today –– therethere’’ll be new ones tomorrow to add to themll be new ones tomorrow to add to them
Plan what you do and do what you planPlan what you do and do what you plan. The planning . The planning process in itself creates a virtuous spiral of continuous process in itself creates a virtuous spiral of continuous improvementimprovement
© 2009 Shire Systems Limited
Taglines to keep in mindTaglines to keep in mind
Repairing equipment Repairing equipment wellwell is more important than is more important than repairing equipmentrepairing equipment fastfast.. DonDon’’t shoot yourself in the foot by t shoot yourself in the foot by letting your present maintenance actions embed equipment letting your present maintenance actions embed equipment defects that will cause future failuresdefects that will cause future failures
SHE accidents precipitate substantial extra costsSHE accidents precipitate substantial extra costs. Track . Track the failures and eliminate their systemic root causes to save the failures and eliminate their systemic root causes to save the cash penalties that sap your organisation the cash penalties that sap your organisation
The devil is in the detailThe devil is in the detail. Others say God is in the detail. . Others say God is in the detail. You canYou can’’t solve problems in general, only in detail t solve problems in general, only in detail
Superficial goals lead to superficial resultsSuperficial goals lead to superficial results. Aim for the . Aim for the stars and you may hit the moon. Aim for the fence and youstars and you may hit the moon. Aim for the fence and you’’ll ll only shoot yourself in the footonly shoot yourself in the foot
If youIf you’’re not winning, youre not winning, you’’re losing.re losing. Adopt and foster a Adopt and foster a ‘‘nono--status quostatus quo’’ mindsetmindset
© 2009 Shire Systems Limited
Taglines to keep in mindTaglines to keep in mindImprovement is a people issue Improvement is a people issue -- itit’’s the people, stupid!s the people, stupid!You can devise the best system in the world, but when itYou can devise the best system in the world, but when it’’s not s not supported and used by the workers on the ground, itsupported and used by the workers on the ground, it’’s not s not worth the paper itworth the paper it’’s written on. Orchestrating a golden link s written on. Orchestrating a golden link between human behaviour and management systems is keybetween human behaviour and management systems is keyReject selfReject self--fulfilling prophesiesfulfilling prophesies. Never accept the . Never accept the defeatism of the naydefeatism of the nay--sayers. You can do it! Yes you can. Aim sayers. You can do it! Yes you can. Aim high, expect success and throw off the wet blankets others try high, expect success and throw off the wet blankets others try to cast to cast You get what you expectYou get what you expect. The Leader. The Leader’’s expectations set the s expectations set the tone and determine the achievement. An individual takes his tone and determine the achievement. An individual takes his reference from his Leader. As the Leaderreference from his Leader. As the Leader’’s attention and s attention and focus turns on an issue, so then do the eyes and minds of the focus turns on an issue, so then do the eyes and minds of the LeaderLeader’’s staffs staffMeasures are no substitute for leadershipMeasures are no substitute for leadership. Performance . Performance indicators, like CMMS itself, are just another tool to aid the indicators, like CMMS itself, are just another tool to aid the LeaderLeader……
© 2009 Shire Systems Limited
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