Think asset management when the chips are down

Maintaining plant assets – whether that includes production line equipment, furnaces, machine tools, tooling, motors or conveyor systems – should no longer be a set of jobs left to the maintenance manager alone to sort out. It’s a far more critical issue than that these days, especially if you’re part of an asset-intensive industry where your equipment and plant infrastructure is large, complex, expensive and has a long lifespan. And if stoppages to your production line due to equipment breakdowns are costing you precious time and money, read on. Although there’s certainly a growing number of manufacturing companies today, at boardroom level, that are beginning to realise that asset (or maintenance) management is now an issue which deserves enterprise-wide, perhaps multi-site, attention, in general, most plant or maintenance managers still don’t get a voice in the higher echelons of the boardroom. Maintenance is simply viewed as a necessary cost to the business and no more. But the fact is, any initiatives (including software) that can support an asset management strategy are likely to help shave costs from a company’s balance sheet. Hence, the software community’s latest buzzword, ‘EAM’, or enterprise asset management. It’s more than just maintenance management software we’re talking about here. EAM is all about companies taking a business-wide view of all their plant equipment and co-ordinating maintenance activities and resources with other departments and sites, particularly with production teams. Savings from EAM are reasonably well-documented and come in various guises, the most common benefits being: less equipment breakdowns (leading to a reduction in overall plant downtime); a corresponding increase in asset utilisation or plant uptime; better management of spare parts and equipment stocks; more efficient use of maintenance staff; and optimised scheduling of maintenance tasks and resources. More than software It’s not simply about purchasing maintenance software that sits alongside your existing ERP or legacy business system, or buying a ‘best-of-breed’ asset management system for that matter. What is important to understand here is that there’s likely to be a lengthy, quite painful maintenance review process necessary up front before any type of installed software is going to solve your maintenance management headache. As with many business scenarios, although software is often an essential piece of the overall jigsaw, on its own, it’s never enough to bring real value to the business. Manufacturing success stories are not difficult to come by. Take PAS Grantham for example. It’s a great illustration of how difficult it can be for a plant manager to persuade his board (or former MD in this case) to part with tens of thousands of pounds for some software (plus plenty of internal effort as well mind you) that has since saved the company hundreds of thousands of pounds every year and reduced overall plant downtime over the last 10 years from 12.5% to just 2.4% today. PAS is a UK subsidiary of McCain Foods, a manufacturer of potato chips for most of the well-known supermarket brands. Based in Lincolnshire, the firm’s annual turnover is £85 million and there are 250 employees at the site, around 45 of these in maintenance (which operates four continuous shifts). The plant itself has two main production lines with most of the critical equipment in series. There are around 20 pieces of kit on each line including steam peeling machines, blanching equipment, pre-heaters and chip cutting machines. More than 45 tonnes of potato per hour travel down each line, so any equipment failure or breakdown that stops the line, causes complete havoc. “The whole plant stops running if we don’t do our job properly. If there’s a line stoppage for more than 15 to 20 minutes, the potatoes turn brown and all the product before that stoppage becomes waste,” explains PAS’ plant manager John Bowman. “If, for instance, we had to throw away 15 tonnes of potatoes at £100 per tonne, that’s £1,500 for one stoppage, plus £800 an hour fixed costs on each line.” Driven by a continuous improvement initiative across the site and the twin objectives of increasing plant uptime and cutting maintenance costs, PAS decided it needed to implement an optimised maintenance plan incorporating condition-based maintenance (CBM). The firm selected Manchester-based software author and asset management consultancy Wolfson Maintenance’s integrated asset management system, Mimic. Before any software was implemented though, PAS had to go through a full review of its maintenance requirements of critical production equipment. Key equipment failure modes were identified and the most appropriate maintenance strategy was selected. Where CBM was chosen, Wolfson’s ‘most effect’ monitoring technique was adopted, ranging from vibration monitoring, to thermography, oil debris analysis and visual checks. “Before Mimic, we were using paper records, job cards and wall charts to manage maintenance. We had to try to look up the history of machine failures or ‘hotspots’ as part of the review process. This part alone took us around two months to complete,” says Bowman. The new, integrated maintenance plan, which includes condition monitoring, scheduled maintenance, on-failure and design-out maintenance was all set up using Mimic. PAS staff were trained to use the software and over a period of twelve months became fully proficient in shopfloor data collection, analysis and system management. The savings have been impressive, even startling. On one of the firm’s typical potato fryer circulating pumps, what used to be a six hour planned maintenance strip down task has been replaced by a five minute vibration monitoring and thermal condition check. This is sufficient to detect a whole host of possible causes of failure: cavitation, out-of-balance, misalignment, bearing damage, bent shafts, damaged impeller, loose electrical connections, cable damage and the like. “We documented savings from the system in the first two years,” says Bowman. “We’ve made clear savings from the prevention of breakdowns and the reduction of secondary damage… And increases in the efficiency of maintenance planning and control have reduced management workload, freeing these people up to focus on long term improvements to the plant.” Total plant ownership now He goes on to say that the implementation of the optimised maintenance plan, supported by the asset management software, has led to total annual savings of between £150,000 and £200,000 since 1993. “There’s been a 20% efficiency improvement of the maintenance work, plus an increase in plant uptime from 87.5% to 97.4%,” he adds. “Other McCain plants [Whittlesey and Scarborough] are now planning to implement the same integrated maintenance plan.” That’s not all though. Bowman says there are other benefits too. “We’re not just maintenance engineers any longer. We used to run around with spanners in our hands fire fighting. Now, we’ve freed up time to help with production projects. If a new line needs designing, we get involved in the specification and ordering side of the project. We can actually use our experience to design-out maintenance issues. You could say we have total ownership of the plant now, including the design of the production lines.” He also points to a significant headcount reduction as another cost saving as a result of the new software and maintenance review process. “We’ve seen a 20% reduction, four people in total. That’s one man per shift. When we stopped running around the factory firefighting everything, we suddenly realised we didn’t need that many maintenance engineers. It just didn’t make business sense to keep them.” And Mimic is also helping PAS pinpoint and eradicate potential causes of equipment failure. As Bowman explains: “I can ask the software for the top 100 causes of failure on a peeling machine over the last five years, look at related costs, time to fix, and if there were any consequential losses.” He estimates the firm has only spent something like £75,000 on Mimic (and upgrades) and related hardware over the last eight or 10 years. “We have seven software licences and PCs at present.” What is astonishing is how hard Bowman had to fight to persuade the former MD to buy the new software. “The only way I could persuade him to buy the software was through my own department’s revenue budget. The real issue I had was making the board understand the true cost of downtime to the plant. It’s always far higher than most MDs think. They don’t always have the visibility of what’s happening down on the shopfloor.” Asset contribution tools So where are companies going wrong and why aren’t more manufacturers following PAS’ lead? Ian Thompson, commercial manager at Wolfson Maintenance, has a theory: “The key to success is really the quality of information you input to the software. Part of this relates to the success of the up-front review process as well as the ongoing discipline of your maintenance and production teams that use the system. The data has to be as close to 100% accurate as possible to get maximum benefit from the system. “We have a series of asset contribution tools or enablers [not software] that we suggest clients use before implementing software. Things like senior management workshops, advance equipment audits, even training maintenance staff how to logically approach and document equipment breakdowns. Also, resource management is important [ie putting your maintenance staff in those places where they will have the best effect]. Just teaching people to concentrate only on the 80% of breakdowns that are business-critical.” According to Thompson, manufacturers should understand that asset contribution is an integrated maintenance and operations (production) issue. James Fair, VP EMEA at MRO Software, a specialist supplier of asset management software, agrees with Thompson. “Engineers find it difficult to communicate ideas up to board level. There are certainly big consultants who can better communicate the messages to senior executives, but these guys find it difficult to connect their ideas to bottom line savings on the shopfloor.” If you’re looking for specialist suppliers of maintenance or asset management software, then you should check out vendors such as MRO Software, Datastream, Shire Systems and Wolfson Maintenance (for a complete listing, go to www.mcsolutions.co.uk). However, there are a growing number of enterprise (ERP) software players (SAP, IFS and JD Edwards in particular) that can offer a level of EAM functionality that may satisfy many companies (or at least those that have already purchased their ERP). And there’s another way. Plant controls vendor Rockwell is doing some interesting asset management work for some of its clients over the web, as a kind of outsourced asset management service. John Seddon, the firm’s UK account manager, explains: “For two to three years now, we’ve provided a service for our customers whereby we gather onsite plant data [such as vibration monitoring and noise levels using handheld devices] for them, send the information up to a web page so that our team of analysts at Rockwell can look for trends, potential breakdowns, etc and advise the customer accordingly.” He says many companies Rockwell are dealing with want to move away from investing heavily in training staff and buying condition monitoring hardware and software and use the service instead. The web can also provide a medium for purchasing MRO (maintenance repair and overhaul) items for critical plant equipment. MRO Software currently provides the underlying software for an online marketplace – Endorsia.com – a single electronic network for MRO buyers and suppliers. The brainchild of bearings manufacturer SKF, Endorsia already has a membership of more than 700 distributors and 40 manufacturers across 45 countries. Transactions through the online marketplace have grown more than 65% over the last 12 months, from 327,000 in Q2 2001, to 540,000 in Q2 2002. Says Endorsia’s CEO, Ralf Nordahl: “One of the main benefits of the marketplace is that it allows manufacturers to communicate information [via online catalogues] such as product features, maintenance guidance, safety instructions and training. “The sourcing of MRO products is characterised by a high number of items often of low individual value but of strategic importance for the continuous running of a factory where a standstill, caused by a missing part, can cost millions.” And that’s precisely the reason why companies need to stand up and take note of EAM and its online counterparts.