Reliability Success !

Preventing Failures of RCM - Pt 1

2009-11-28T17:30:00.000-08:00

After a long and winding journey RCM is finally findings its rightful place as a cornerstone of modern asset management. The benefits are well documented now and cover all aspects where physical aspects have an impact on corporate performance.

Yet still many programs end with a whimper.

Lack of management support, poor asset selection, lack of momentum and taking technical shortcuts are undoubtedly killers of any RCM program. The overuse and misuse of criticality, streamlining the method instead of the implementation process and poor program management accounts for a lot of these issues.

Yet all are joined in one classic error; the failure to adequately train RCM Analysts.

When reviewing RCM analyses I often come across annoyingly similar mistakes, all of which have potentially harmful impacts, and all of which are avoidable if the RCM Analysts are properly prepared in the first place.

These errors tend to fall into three categories, and aside from the impacts below they are all motivation and momentum killers.

Failure modes at the wrong level of causality. Leads to blanket strategies not connected to the failure mechanisms, over use of the run to failure options, and excessive spares options required.

The worst effect of this of course is the fact that not all of the reasonably likely failure modes have been uncovered. Yet everyone familiar with RCM expects that they are. False sense of security, unmet expectations, classic failure of the implementation.

Combed of ambiguous failure modes - "Control Failure" is a classic example of this, so too is "bearing fails due to wear or contamination". Again there is almost no way to get the right sort of failure management strategies in these situations. This is not uncommon where someone is trying to justify what already exists, instead of determining the real maintenance requirements.

Developing strategies without using the decision diagram(s) - This is a shocker and almost always happens to first time RCM Analysts. The trap is to fall into inserting the strategies that already existed instead of developing strategies to manage the failures found. This has the effect of a zero benefit analysis, or worse - one that is incorrect. (And potentially dangerous)

It is easy to come undone here. Time based failures really seem like they should be managed using a predictive task of some sort... but how is this done? Lots of questions like this exist between completing an RCM Analysts course and becoming good at it.

Misapplication of the Detective maintenance formulas - This is far too big to discuss as part of this stream. But suffice to say that it is one of the real potentially dangerous areas of the analysis.

These are all errors related to technical soundness of the analysis, and there are of course, lots more like:

Defining design capacity instead of user requirements
Defining functions that are already covered by the primary function
Basing detective maintenance frequencies on evident (safe detected) instrument failures... and so on...

In the next posting in this series we will go into some of the program management failures. Those failures that almost guarantee the work will get little support, little momentum, and very little chance of accomplishing what the organization has set out to accomplish.

The way to combat these failures is to have adequately trained RCM Analysts. Analysts who have received both classroom and on the job training, as well as being coached through the program management issues.

Check out the best roles in the game for maintenance and reliability professionals!

Re-defining the role of Electrical tradespeople

2009-11-21T03:15:00.000-08:00

Even at the beginning of the twenty first century, almost every maintenance review we do uncovers a raft of electrical tasks and routines that serve no purpose apart from raising the likelihood of equipment failures.

When I was a baggy shorts apprentice back in the 1980's we used to do lots of tasks like opening up motor termination blocks, and marshaling cubicles and checking for tightness of the terminals.

And then, at least once a year, there would be a huge influx of large DC motors from the mining shovels and draglines which we were supposed to overhaul.

This ended up being a change of the bearings, re-painting the windings to restore the insulations original resistance to failure, and running a wheatstone bridge over the windings looking for indications of early life failures.

In the vast majority of cases this was a dramatic waste of time! And I cannot believe that this thinking still exists today.

Something I have learned - if it is not subject to ambient vibration, and the cables don't move - then nothing is going to come loose! (Period)

In fact, you run the risk of loosening the terminals by mucking around with them. As well as messing up the gaskets, introducing foreign matter and moisture, and a whole host of other issues under the heading of "messing with things that are working fine".

In the case of DC motor overhauls, most of this stuff can be done in situ. Skimming armatures, replacing and bedding in brushes, and getting rid of excess carbon build up are all small and regular tasks that need to be done in situ, not in an overhaul situation.

Bearings should NOT be replaced on a hard time basis! This is one of the greatest scams of modern asset management. Do you really need to re-paint the windings to restore the insulation? I have yet to find a case where not doing this has led to early failures. (But there are many cases where interfering has caused failure!)

So what should Sparkies do then?

There are routine tasks that electricians should be doing, and some of these are above. But principally electricians are there for the hard hitting end of the deal. The moment when it all turns to muck and we need to rapidly get to the bottom of the problem.

The job creation works as outlined above are more likely to lead to failure rather than prevent or predict it. The heart of the problem is our attitudes towards maintenance people and their employment.

If hey aren't actively engaged in maintaining assets then we see them as wasting our funds. Yet with a small mind change we could employ the electrical trades in a lot of higher end tasks such as analytical problem solving and reviewing general maintenance practices.

We don't need to force them into activities that are detrimental to our operations...surely.

Check out the best roles in the game for maintenance and reliability professionals!

Maintenance and Management - The root of the problem (Pt 2)

2009-11-14T03:07:00.000-08:00

If we are ever going to get around The Budget Game, and build budgets that truly reflect our real spending for a desired level of performance and risk, then we need to get to the base of how it is done nowadays.

When a maintenance manager starts thinking about what she will need for maintaining the plant over the next twelve to twenty four months their first port of call is often a combination of the anticipated routine activity for the future, and the near past.

Routine forecasting

Future proactive activity generally comes from the forecast planned maintenance tasks held in the companies CMMS / ERP system. If an organization has its act together, then this will include both the OPEX maintenance and the Capital maintenance planning. (And surprisingly few actually do have this stuff together)

But... where did this stuff come from in the first place? If your plant is anything like most plants then job-expectancy is around 5 years. meaning that few people even realize why these activities are being done and even fewer have the foggiest as to where they came from.

Once you star to dig into it a little, you find out that the routine OPEX stuff, operating maintenance lets call it, generally is a combination of manufacturers recommendations and experience. (Experience meaning "Ouch that hurt, lets not do that again")

There have been reams of articles written on this, but there are many issues with manufacturers guidelines. One particularly nasty issue is the facts of a manufacturers business model. This is generally something like; "move as quickly as possible to the next model, rush through the basic engineering, make sure all maintenance recommendations are conservative, and above all DO NOT GET SUED!"

So it isn't too much of a leap in logic to work out that building and relying on a maintenance strategy that comes from this background, or waiting until things go wrong and force our hand, is both undesirable and possibly even unethical.

And then there is the real fun stuff...the capital maintenance plans. For the sake of this article we will say that these are all the major refurbishments, replacements and overhauls.

Where does this come from? Does anybody ever really know?

My experience, again after researching into the dim dark pasts of many plants, sites and companies, is that it is often provided by either accountants or the initial contractor.

And the logic is often tied to either the depreciation dates of the assets, which is a bit of financial black arts once you get into it, or it is tied to something a contractor put into his / her spreadsheet because "thats what they were asked to deliver".

Thats a bit frightening isn't it? Not something you would want to bet you career on is it? (or worse, the lives of those working with or near these assets)

Forecasting Corrective Maintenance

This is where things really go haywire. Every person who has had anything to do with Life Cycle Modeling, or Whole-of-Life asset planning, has generally encountered this problem.

How do you forecast corrective maintenance? Most people generally arrive at the point where they decide to take an average of the past 2 years (pick a number) and then use this, minus 10% (because you're going to get better right?) as the means of forecasting corrective actions.

And the problem is???... It is absolute sheer and utter garbage.

What happened last year, or in the last five years, may have little or nothing to do with what will happen next year. There are failure modes that have not yet occurred, corrective actions that have been eliminated totally, and a whole range of additional considerations on the efficiency front.

The size of the prize

So we are now facing the point where we know:

a) The routine maintenance may, or may not have anything to do with the levels of performance and risk we require from our assets.
b) Not only that but they came into being in uner dubious circumstances to say the least.
c) Our routine capital maintenance is probably overly conservative or some other derivative of fairy land forecasting, and
d) Our corrective forecasts are, at the very least, dead wrong.

Comforting isn't it? Took me a while to get to this point in my thinking some years ago.

But if we get it right what could happen?

1) On the local front the Budget Game turns from an annual competition and negotiation to a discussion about performance and risk.

2) We get strategies designed to deliver the performance and risk we are chasing, and most importantly...

3) We start down a path that will get us a greater level of confidence, dramatically greater, about our net present costs. (All of the costs we will ever have in todays money)

The last one is a kicker, and we went into the real value of high confidence Net Present Value forecasts in the last article.

In short, it takes maintenance from something we think (because everyone is telling us) is a strategic initiative - through to a firm board room topic and long term competitive advantage.

Not bad for bunch of grease monkeys (like me) and technicians is it?

Check out the best roles in the game for maintenance and reliability professionals!

At the heart of reliability

2009-11-14T02:07:00.000-08:00

"Reliability engineering is concerned with forecasting and preventing failures..."

I just read this in an article I am reading by a respected author and practitioner on reliability engineering. The sad fact is that he is wrong, and this line of thinking has been wrong for about half a century now... old habits die hard I guess.

By forecasting this guy means "forecasting" as in probabilistic modelling. Now while I agree with the use of probabilistic tools where it is warranted, blanket statements like this are what lead people into dramatically over analyzing and over maintaining their plant items.

Lets take the case of a bearing failure. Due to long term minor overloading cracks have developed within the inner race, breaking the surface and rapidly contributing to the deterioration, and ultimately the failure, of the bearing.

The consequences of this failure are severe, so severe that a condition monitoring regime has been put in place and is being done at 33% of the P-F Interval. (To make sure that the onset of failure is detected)

How then are you going to prevent the failure in this case? There's no way known to man.. the bearing is going to fail just as the sun will rise again tomorrow. Nothing in this world will stop it... what we can do however, is preempt it somehow. Through early interventions, changes to the production run cycle or whatever other options you may have.

Are we about predicting failure here? Yes! Not forecasting but predicting as part of our failure management strategy.

And why have we bothered? Because the consequences are severe.

Lets take another example of an over speed switch in a turbine. A plant has 6 turbines. After careful consideration of the demand rates, failure rates and acceptable / tolerable levels of risk we calculate that these need to be checked every 18 months. (say)

We perform our baseline checks and find everything to be okay, and it is not until we check for the third time that we actually find that one of the over speed switches is now in a failed state. (Meaning it will not work to protect the machine if it is needed)

Preventing, avoiding and even (in this case) predicting the failure is way out of the question. Actually it has already failed.

Again we see that the reason why we are doing this at all is not to predict or avoid failure per se, it is to manage the consequences to a tolerable / acceptable level.

So where is all this going...

Even those who are very deeply embedded in probabilistic analysis realize that the likelihood of accurately forecasting failure is very remote. Because the data is never available. In fact, in my own experience with probabilistic analyses I have found that most turn into projects to try to find relevant data to use in the model.

The famous statement on the use of Weibull is that you only need 3 failure points. Fair enough... but getting even those three is often exceedingly difficult.

They need to be of the same failure mode, and if they are serious enough to warrant investigation then they carry significant safety / economic consequences. So analyzing them after the fact is almost in the realm of negligent isn't it?

The whole point of modern asset management is not to predict / forecast dates of failure - it is to manage the failure process where the consequences warrant it!

The Predictive and Detective maintenance examples above are pretty clear on this. And then there are run-to-failure cases, where we have determined that the most effective means of managing the asset is to actually let it fall over.

Do probabilistic methods have their place? Of course!! I'm a big fan of most of them and I use them regularly within my team and our business - but only where they are the best option. (You know the old story, when you have a hammer everything looks like a nail)

The real danger is thinking that it is all about preventing or avoiding failure, it is not - and thinking it is will lead only to frustration, over maintenance, and misapplied maintenance strategies.

Check out the best roles in the game for maintenance and reliability professionals!

Maintenance and Management - The Budget Game (Pt 1)

2009-11-10T02:48:00.000-08:00

The Budget Game is played out year after year in the vast majority of asset intensive organizations all around the world.

And what is the budget game? I'm sure you will recognize it.

1) I know that the manager is going to try to cut back my budget so I am going to pad it out a little.

2) The manager knows that you are trying to pad it out a little, so he knows he has to cut it back.

3) And when we are getting near to the end of the financial year make sure to spend every cent you have or they will take it away from you next year.

Survival of the fittest. Those who can outmaneuver each other wins this round and gets what they want. But generally, the entire organization pays the price.

The seriousness of this didn't occur to me until I saw the case of Severn Trent Water in the UK. Where the Serious Fraud Office was called in by the industry regulator, with implications of charges being laid against individuals.

Wow...the entire industry took a deep breath and suddenly every conversation had a different shade to it.

This was obviously a very specific case and an extreme example. But the more I thought of it the more logical it became. When you pad out a budget what you are actually doing is defrauding the shareholders, owners, and in the case of regulated industries sometimes even the general public.

Yet everyone plays the budget game every year... that's a frightening thought when you look at it in the light of this line of thinking.

It was about this time that I, and a few select clients at the time, began to look seriously at bidgeting practices and how they could be improved to eliminate The Budget Game.

The screamingly obvious issue was that without a solid and logical tie between performance and risk, and the activities required to achieve it, that this issue was never going to go away.

And in the mire we uncovered a few practices, techniques and planning mechanisms that would not only eliminate the budget game, but when implemented correctly it could force an entirely new dynamic on the management of the asset base.

The first of these was Zero Based Budgeting, the second, an evolution of the first, was Risk Distributed Budgeting.

While Zero based Budgeting was not new, what had been missed previously was it's capability to feed into the long term planning accuracy by setting the framework in place for proactive data capture. (E.g. failure data without crashing a few more assets)

Over the next couple of weeks I am going to post a series on both of these methods, trying to go into detail about what they are, why they matter, how to do it, and of course - how to implement it. (You might want to subscribe via the links at the top, or via the email subscription box on the side.)

Without even considering the financial and risk impacts of this form of work during the implementation, other impacts of this work includes:

Tying costs directly to the required / expected performance and risk of the physical asset base
Eliminating costs tied to bad habits formed over years. (Remember the monkeys?)
Setting up a framework for proactive data capture
Increasing the accuracy of capital maintenance activities
Elimination of The Budget Game

And if your organization track such things, and if they do not then they should do, you start to get a vastly higher level of confidence about the net present costs of the asset base. Meaning, more importantly, a far greater level of confidence over the Net present Value or profits of an organization.

Thats the sort of thing clients can take to the bond market for billions, not millions, of dollars in potential benefits.

Game changing ideas...

Part 2 - The Root of the problem

Check out the best roles in the game for maintenance and reliability professionals!

Monkey see, monkey do...

2009-11-08T04:04:00.000-08:00

Ever hear the one about the monkeys and cultural change? I am probably not going to do it justice but it goes something like this...

There are three monkeys standing in line in a cage, and above the third monkey there is a bunch of bananas. The third monkey naturally reaches for the sweet treats, and as he takes one, the other two monkeys are drenched with water.

So they immediately start at the third monkey who is busily munching on his favorite food. But he doesn.t realize what.s happening, so he reaches for another banana and the other two are deluged.

By the time the third monkey has eaten the bunch of bananas, the other two are quite annoyed. So in steps the scientist, and replaces the third monkey with a new monkey. He spies the bananas and as he stretches out his arm, he is attacked by the other two monkeys.

The new monkey doesn.t quite understand why, but quickly stops going after the bananas. Some time passes and the scientist comes back and takes one of the drenched monkeys and replaces him. This new monkey again goes for the bananas and the other two attack him.

Then the scientist replaces the third of the original monkeys, with a new one. This new monkey is immediately attacked, and has no idea why. Even when the banana/water system is disabled, and another monkey introduced, he is attacked immediately.

And if the scientist keeps repeating the experiment, the two monkeys in the cage attack the new ape being introduced, though nobody can remember why, its just the way it is.

This is how maintenance regimes are formed, how streamlined and often counterproductive RCM techniques become "the way we do things around here", and repeat or chronic failures become accepted as part of the cost of doing business.

In the past twelve months we have seen the downfall of several global banking institutions. Accompanied with more than a few career burn outs as well.

These people were all exceptionally smart, just like you. And they were all exceptionally motivated and hard working, just like you.

So what went wrong? Mindless copying of their peers... monkey see, monkey do...

What are you doing?

Check out the best roles in the game for maintenance and reliability professionals!

RCM Rules of thumb

2009-11-07T16:33:00.000-08:00

I thought I might just post some of the rules of thumb I have learned to use for RCM over the years.

I hope they are useful to you, feel free to add your own in the comments section at the end of the post.

Operating Context

Anything nearing a page or more is generally wrong, over technical and focused on the process description or functions instead of how the assets are used.

Functions

Anything less than 16 shows an analysis at too low a level, or a highly inexperienced facilitator.

Much more than (say) 28 functions means you are generally in too high and the analysis risks becoming superfluous.

Omitting functions is often a tool used by facilitators with a vested int erest in making the analysis agree with what they had developed in the past.

Failure Modes

An analysis filled with human errors and containing little in the way of engineering failures (Mech/Elect) generally indicates two things:

The analysis team is inexperienced and probably has no right being involved in the analysis from a technical standpoint.
Their is an incredible level of distrust between maintenance and operations which is being made worse by conducting the analysis without operations involvement and over sight.

If you have more than (say) 30 failure modes for the primary function then you are going in at too high a level and risk an analysis that is superfluous and devoid or real ability to deliver results.

If you have doubts over the level of causality of the failure modes the question to ask is, "what causes that?" If there is a plausible answer that the team could deal with, then the analysis is at risk of being a waste of time.

Strategies

Strategies that are shoe horned in and do not comply with technical feasibility or effectiveness criteria are generally because the facilitators want them to be included and is unable to justify them on the logic. It means things are not headed in a good way.

Developing strategies is the best point to include corrective actions and develop the zero based budget, as well as the whole-of-life framework.

Starting out

Money generally speaks louder than risk. If you select assets where their are revenue improving or cost reduction opportunities then you are more likely to get corporate support, and more likely to gain the momentum required to turn a pilot into a project, and ultimately into "the way we do things here".

Most (not all) variations from SAE JA1011, the RCM standard, are due to the limitations of software sold by vwendors, as opposed to any true scientific or logical divergence. Your question needs to be - are they selling you their solution - or are they selling you your solution.

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Not a Moubray-esque summary of rules of thumb - just a short note on some of the things I have noticed during my career running around doing these things. Feel free to add to it in the comments below.

Check out the best roles in the game for maintenance and reliability professionals!

New maintenance titles and the evolution of "smart"

2009-11-07T13:25:00.000-08:00

Our area is always awash in change. Every week there are talks about new technologies, methods and studies. In the last couple of weeks I have been noticing a trend that I find particularly exciting.

Three of my contacts, two of whom I trained in the past, have recently been promoted to the positions of Global / Corporate RCM Managers. Both work for significant organizations.

On checking this further I found no less than 130 professionals within my network who are now working in roles called RCM Manager. This is in industries ranging from Healthcare to Steel manufacture, through to Oil and Gas and out to the mining industry.

This is a fantastic development. One that recognizes the true strategic importance of equipment strategy creation as a foundation and centerpiece of all reliability initiatives.

It also shows that the message is filtering out quite rapidly now. In the past 10 - 15 years there have been scores of methods and approaches that have sought to dumb down the field of physical asset management.

Reduce it to its lowest common denominator, preaching to that core of managers who just don't "get it".

And they had a lot of converts. In fact, in some markets they were able to convince a frightening amount of people.

Fortunately the tide is turning on this sort of dumbing down of the discipline. And while there will always be a core of people defending dumbed down reliability, the number of people who now understand the message is growing everyday.

This can only be a good thing.

Check out the best roles in the game for maintenance and reliability professionals!

The economic crisis and maintaining mining equipment

2009-09-08T16:47:00.000-07:00

Times have been tough lately for those of us in the maintenance game.

I work predominantly for Mining, Steel, Oil and Gas and Infrastructure firms. I have done some stuff for Beer producers, food producers and others in the manufacturing sectors, but predominantly I am in the sectors above.

Take the Nickel industry as a case in point. I like Nickel as a commodity. I believe in the long term story around Stainless Steel and its market prospects. But the last year has seen it drop dramatically, while the stockpiles listed on the LEX have grown inordinately.

Demand down, driving prices down, driving stockpiles higher. Even if things pick up tomorrow there will still be a lag on profitability for my client organizations.

In Australia we have seen BHP close Rocky's Reward, sell off the Yabulu smelter (Possibly for different reasons) and recently announce lay offs at Mt Keith. There is a long road ahead for Nickel...

On the other side of the coin are the Gold Producers. Newmont, Barrick, Newcrest and Lihir Gold. These guys were doing okay under the boom conditions of the past few years. But as always, when everything else turns south Gold shoots through the roof.

As always there are purchases, acquisitions, new ventures and projects everywhere.

Somewhere in the middle is Iron Ore and Coal. Sure these guys have been hit with reductions in market prices recently, but they were enormously profitable industries in any case. Pricing is another issue that is different with these industries, but we will leave that to one side for now.

But just as Nickel has a long way to go, these other industries (Gold, Iron Ore and Coal) will soon find themselves under increasing pricing pressure regardless of what happens with the settlement price?

Why? projects coming online. I grew up in Iron Ore provinces, it is literally everywhere. And there are a raft of "juniors" who are entering the market, challenging pricing levels and threatening to create a panoply of providers instead of the few that are in the game now. Coal is similar, and Gold mines always spring up when the money is good.

The lesson here is to avoid the boom and bust of the past. Not on the pricing side, that is a little hard for any one company to control, but on the costs side.

When times are good resources companies tend to bloat up, filling themselves with additional staff, departments and functions within the company. When times are bad it all ends in tears with many promising careers cut short and general disarray facing the organization.

The lesson in all this is simple. Establish the minimum safe cost for maintaining mining assets from the word go, and then stick to it.

And the way to do it is to continually think as an entrepreneur thinks. Focus on what your business is, how you earn money. And push everything else out to the side. Out to where it becomes somebody else's problem, and where it can easily grow or shrink to match corporate requirements.

Check out the best roles in the game for maintenance and reliability professionals!

Decision Making in Asset Management (Or...beyond criticality matrices)

2009-08-31T16:16:00.000-07:00

Making decisions in physical asset management is an incredibly complex task, and one that carries with it substantial risks, penalties and rewards.

Yet for an area with so much importance there is surprisingly little information out there on how to make high confidence decisions. Decisions that will progress the organization and support present goals and objectives.

These could include decisions on operational budget spending, CAPEX spending, where to start with a reliability / improvement initiative, how many assets a company should have (fleet management being a gigantic issues here), and many other areas. IN fact, the list is as long as your imagination is...

My experience is that there are four very different ways that asset intensive organizations can make decisions.

Yet they normally all gravitate to one method, that of criticality.

A method that is severely questionable both in terms of application and in terms of results.

This is a short list of methods I have used, their applications and their limitations.

1) Criticality (Of course)

Overused, misunderstood, and often the cause of reliability program failures. However - criticality does have very good uses, and can be deployed for great effect where certain criteria have been met.

Namely:

It must be applied at the failure mode level. Meaning all functions and all failure modes must be identified first.
Best used where assets/systems have relatively few functions. Such as instrumentation systems or "simple assets". (Pipes, tanks, vessel structures etcetera)
It should not be used in any way that aggregates the consequences, nor tries to place numeric dollar values on issues such as human life. This is an inherently dangerous practice as you can often find high cost operational failures coming in as more critical than failure that can kill people. An unacceptable situation.
Very useful for managing the work order backlog as the corrective / reactive tasks therein are already at the failure mode level.

As indicated above criticality approaches need to be conducted based on a "first past the post" approach. If it is intolerable in the safety area then you do not need to assign any further consequences to it. (At all, ever)

Safety wins...

One of the most puzzling issues surrounding criticality is that it is a term that is used so widely in industry, without any real consistency.

But normally it is a process used to determine the most important assets. This is where the problem actually starts.

Most important does not mean most beneficial, nor does it mean worst performing, highest cost, or largest impact on the companies bottom line. Just the most important. (More on that in another post)

2) Prioritization (Analytical Hierarchical Process)

I discovered AHP when I was working int he UK and it has proven its value to me time and time again. I really like this method as a quick way of prioritizing work and / or spending.

The heart of the approach is to first find out what is really important tot he organization. (Not just what they say is important) And then use this as a guideline to prioritize the work/spending that is under consideration.

This is of course a simplification. The process is a bit involved, but it is rapid, accurate, and delivers superior results in my views.

The reason for this is that it supports the current views and thinking of the organization at large. Particularly if it has been well applied. So instead of the most important assets, we immediately shift to thinking about the highest impact assets.

Variations of this approach have been adopted by rail and infrastructure organizations throughout the world.

3) RAM Modelling

Another favorite of mine. Availability modelling of process plants, heavy equipment fleets, conveying systems, water networks and so on is probably the most accurate and rapid way of highlighting weak points in the existing asset base.

The overall approach falls under de-bottlenecking and is another excellent proactive means of deciding where to place resources and funds for future performance requirements.

4) Bad Actor Analysis

Easy, simple and abundantly available. Production loss accounting is probably the most widely used prioritization method globally and for good reason.

It enables maintenance / reliability managers to pinpoint where the money is draining from the organization (in terms of lost profit opportunities) and provides short term results that are normally of a very high magnitude.

I hope this is of some use, and I hope it stops you reaching for the criticality matrix first next time you need to make decisions related to how your maintenance is carried out.

Taking decisions is a very complex area, and one that needs to be addressed using a range of sophisticated solutions.

Check out the best roles in the game for maintenance and reliability professionals!

Two Types of Reliability

2009-07-12T04:31:00.000-07:00

It bears remembering that there are always type types of reliability that we talk about when we use that term.

The first (without getting into semantic posturing please...) is roughly defined as making sure assets do what users require of them. And that covers a range of areas from safety to the environment, and from operations to reputation and brand issues.

Most of us think we are at work trying to achieve that every day. But there is another kind of reliability. The type that Amazon customer service exemplifies.

Ever used that? Probably not, they are generally pretty darn good at getting the things you want onto your doorstep. I had to use them once when I was working in Saudi Arabia.

My books had gone missing and I had waited several months for them. So, even though it was so late, I filed a complaint with the online web form they have.

This really annoyed me because I hate web forms. Nothing ever happens. So I decided this was a lost cause.

Within two minutes I had an email in my inbox. Not a "We have received your comments" type email - but a real one from a real person asking me intelligent questions about the issue.

I shot back a response and within about another two or three minutes came the reply offering to replace everything I had lost at Amazon's cost, immediately. (There were a few more issues around address etcetera)

I was blown away. Within twenty minutes my issue had been totally resolved from the other side of the world and my books were, apparently, on their way. This same person checked in with me several times over the next week until my books truly were in my hands. (Not an easy thing to do in backwaters like Dubai)

That's reliability.

The first is a definition, and it has to do with organizing resources in the most efficient and effective way to deliver what people want. The second is a passion, springing from people who are determined to deliver what you don't expect.

I am building a consulting team that I hope will exemplify the second type of reliability. Amazon Reliability. The sort of specialists that can give you the answer even though you haven't quite worked out the question yet.

People who are determined to give you what you don't expect. The types of people that can be relied upon.

Which type of reliability department do you work for? Which one would you like to work for?

Check out the best roles in the game for maintenance and reliability professionals!

What the economic crisis means for asset management...

2009-07-11T05:46:00.000-07:00

A recent article on the Huffington Post really turned the light on Physical Asset Management in infrastructure and some of the trends that are starting to emerge as a result of the economic crisis.

In a nutshell it reveals how cities in California are struggling under the shrinking tax base from the crisis, meaning they are looking for alternative methods to fund their estimated $2.2 trillion in infrastructure maintenance spending over the next 5 years.

And even though they didn't say it there is another side to this as well. The USA, along with many other Western nations, have been on a spending spree to try to circumvent the fallout of the economic crisis.

Regardless of what you think of this one day somebody has to pay... so there will be even less cash for cities, states and nations to spend on something as un-sexy as infrastructure maintenance.

Their take was on the Public-Private Partnership (P3) model which sprung out of Europe. In fact the London Underground is probably the most prominent case of a P3 contract worth billions.

The financial model is somewhat complex, but the end result is private industry sharing the costs for funding, and managing the public infrastructure such as trains, roads, water and electricity where this is still in government hands.

So what does a PPP contract mean to California or the USA?

First, there are far more options that just the PPP option. The UK in particular has stood out as a leader int he utilities infrastructure industry for the way that they privatized their water and electricity utilities.

But in the area of PPP by itself there are many advantages for consultants, contractors and maintenance professionals.

There are arguments to and fro regarding whether they are a good thing or a bad thing. And of course everyone can easily point to the costly and potentially dangerous collapse of Metronet.

However, my experience has been:

Decision making becomes more diverse. With more players in the game there are more decision makers, hence more decisions made.

A variety of strategies and activities spring up as each looks for the leading practice to try to shine brighter than others in the field.

The imposition of harsh regulations and penalties, (As per the Severn Trent Water fiasco) means that a lot more work goes into accountability, and getting it right.

New techniques and focus emerges in asset cost management generally, and in CAPEX justification specifically. (E.g. the PAS-55 work)

The list goes on, but for me it is a no-brainer. Their just isn't the cash in the state coffers to continue to fund this directly, and ways and means are needed to share the immediate costs. Even if this does mean merely putting the full cost off until a later date.

Despite what the naysayers may come up with, I have no doubt that this and a raft of other measures will need to be taken to address the problem of infrastructure maintenance spending on an already neglected US infrastructure sector.

An unexpected but totally obvious side effect of the economic crisis.

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Transferable Skills for Reliability

2009-07-09T20:38:00.000-07:00

I have always found that there are three elements of a reliability professionals skill set, they are, in order of importance:

1) Their implementation and "doing" skills.

2) Their knowledge of reliability theory, application and methodologies

3) Their knowledge of specific asset types and engineering disciplines.

The first area is 100% transferable. Once you can turn ideas into reality in one company or industry, you have the foundations to do it in any company or industry. The third one is a little more specific and also a little less important.

For example, you will only get experience working with Dragline reliability from the Mining industry. Period. Nothing else can give you that. But the good thing is that if you have good knowledge of reliability theory, application and methodologies...then that can be easily adapted to virtually any industry. (Any that I have come across anyway)

So what are the transferable RE Skills?

In my opinion there are three groups of these, and your relative strengths in each depends on what you actually do.

Please note: Being able to say that you can do some of this stuff is not enough! You must have a verifiable track record of achievement in an area before you can claim it as a strength.

Thats not always the case, sometimes there are people who will accept your word for it and give you the job...but there isn't too many managers like that out there.

(I think this would form the basis for a fantastic trainee-ship of some sort)

Maintenance Administration

Maintenance planning and scheduling (Ideally this would include an appreciation of the power of time and motion studies)
Shutdown / Turnaround planning and Scheduling
Work reporting, KPI's and efficiency data analysis. (Like delay codes etcetera)

Reliability Engineering

RCM understanding and track record. (Fundamental) This also means an understanding and preferably track record in FMEA, FMECA and other associated areas.
Weibull analysis and track record (Great to have)
RAM modelling (Great to have)
Root cause analysis and problem solving (Again, great to have)
And behind all of this, an understanding of reliability theory.

We could go into areas like Finite Element Analysis, RBI or SIS - but these are specific rather than general and would be essential for people working specifically in that field.

Regardless, the core concepts above still stand out as must have skills for a reliability professional I think.

Technical Knowledge (Not asset based)

Real strength in at least one of the condition monitoring and/or NDT techniques
A broad appreciation of CBM/NDT techniques, technologies and capabilities.
Data analysis techniques and tools. (Not the high end stuff, the Excel / Access type stuff)

Lots more stuff in the other two areas. Particularly around issues like benchmarking, holding reference information on great performance, presentations, managing change and lots more.

But for core reliability skills I think these cover it. Any others that strike you as core and essential?

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Movements, not champions

2009-07-06T15:33:00.000-07:00

I posted on this a fair while ago, but I thought it was worth while revisiting as it is such a vital part of the reliability and maintenance area of work.

There is a myth out there that reliability projects fail because of a "lack of management support". I have a different view. My view comes from my own implementation experience, and through discussions with industry leaders like John Moubray.

So personally, I find that the main reason for failure of reliability projects is not a lack of support (we will deal with that later) but when the champion leaves.

Looking back I cannot recall how many times an initiative, or an engagement has come to a sudden halt because the "champion" did very well out of it and was promoted.

This brings me to my pet hobby horse. We do not need any more champions, what we need are movements.

In a champions world one, or a few, people are charged with championing an initiative. They are everywhere, speaking to everyone, rambling and ranting and espousing the virtues of whatever it is they are championing.

And following them is often the shadow of their sponsor, looking threatening, and only the slightest hint of something good happening if people are compliant.

It just simply doesn't work. I am not talking about brave people, I love brave people - they make my work as a consultant so much more enjoyable.

Champions leave, the project stops, champions are not effective, the project stops, champions are not supported, the project fails and the poor old champion gets to be the fall guy.

What we need are movements spurred by viral ideas. An idea that is so infectious, and so powerful that it has people running towards it - rather than having to be pushed out there at every opportunity. Movements have leaders, but they don't need them to keep moving forward.

Sounds hard but it actually isn't. We give ourselves away here a bit....

Maintainers in general, and Engineering people specifically - Love machinery! They have a true and very real interest in how things work, and they quickly tap into new concepts and ideas that they are able to understand easily.

I have taught people RCM and watched them almost immediately take a right turn ion their careers, blasting off into new roles, new positions and following what they now see as their passion. I have taught Reliability Modelling to people and watched them also fall under its spell.

Why? It works, it "clicks" and it helps them do what they do best.

Some things I have used to create a movement in the past...

1) Needed. One good idea.

An idea that will infect people who hear it, help them get more out of their work and career, and help the company they work for. (Here are some clues - RCM, RAM Analysis, CBM, Defect Elimination.)

2) Prove it. (You don't get to tell the boss yet)

Get a small group of co-conspirators together and start to pilot the approach. Warning: This part could cost you money. I sent myself on my first RCM course because I thought it would change the world. I love pilots. Not just the proof of concept pilots that you do when engaging consulting firms, but any pilots. Exciting stuff.

3) Tell others about it.

With the pilot done, start to tell other people all about it. Tell them what you did, what the results were, use the value quadrant to talk about benefits, get them excited too.

4) More pilots. (The boss still doesn't know)

With your newly formed group of converts to whatever cause it is you are doing, start to run an additional pilot or two. All small scale, all very tightly focused, all very aimed at making step changes in performance.

5) Tell more people...

Starting to get the picture yet?

Think of it, prove it, tell everyone about it, prove it again, tell more people... and so on.

The biggest roadblock to creating a movement is authority. The people who got to where they are by being conservative, and are not about to get radical now just because "times are a changing."

Creating a movement is about inspiring people to action, not hounding them into it.

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One metric to rule them all !!

2009-07-05T20:51:00.000-07:00

I get asked pretty regularly about metrics. Being the author of a book on the subject it doesn't surprise me...but the most common question is generally something like...

"Which metric do you recommend to give an overview of reliability improvement?"

This is almost always followed by the questioners own preference for either Availability, or OEE, MTBF or something similar.

The only answer that I can give, from my own experience, is that no such thing exists.

Where does reliability have an impact?

Before we think about what to measure, we always need to think about what we want to achieve. All metrics and measures here are at the KPI level, meaning that they are the most important indicators of an area of performance.

There are, of course, thousands of metrics. And there is just no way I am going to try to list them all here.

Reliability improvement will impact on four areas only, and if you want to challenge that then feel free to - I have been trying to challenge it for many years myself.

(Before you try... reputation would be a product of one of the other four, so it is already there)

Increasing Revenue

Often the number 1 goal of any client I have ever had. However, it does depend a lot on the business cycle, demand levels and the price they are selling at. (profits)

Metrics

Maint. Cost / Produced Unit (Ton, Liter, Barrel etc) (More production = less cost per unit. Don't be fooled into thinking this is a cunning way to cut costs only. If that is how it is being used it will fail as a measure)
Availability (More uptime = more opportunity to produce. Therefore more revenue potential)
MTBF (Because you can have great availability and lousy MTBF. The two are not joined at the hip and it is best to track both of them

Insert OEE as you see fit but personally I prefer to run OEE as a separate improvement initiative altogether. Normally coupled with defect elimination and / or RCM.

I really like OEE but it needs to be very clear that it isn't actually Overall Equipment Effectiveness, but primary function effectiveness. Sounds semantic but it is very relevant.

Decreasing Direct Costs

The second most asked for impact of reliability. Again it depends very much on the present economic climate, but this one is normally a good starting point.

Metrics

Maint. Cost / Produced Unit (Again. This time for the cost side of the equation, not just the production side of it.)
Maintenance Productivity Factor (One of the metrics I was involved in creating)
Cost comparisons (Actual versus budget etcetera)

Knowledge Increase

This used to be pretty hard, until I actually worked out what Knowledge increase meant for companies. It used to be filled with garbage like number of technicians trained in (say) RCA.

But that was the old way of seeing knowledge. When we used to think of it as what employees held in their minds only. Today we realize that corporate knowledge is a collection of data + information.

For many reasons that we wont go into here, the goal is to move away from information (the stuff in experienced peoples heads) and towards data. So good metrics here really revolve around the Asset Data Scorecard concepts.

Risk Reduction

Another one that used to be harder to measure. Again until it all clicked during the mid 1990's. Assuming, and it is sometimes a big assumption, that an asset or plant is already being managed with the minimum safe level of maintenance (via RCM or whatever) then a practical measure here is Schedule Compliance. (Particularly of safety related tasks like vessel inspections, function tests and so on)

Another great risk forecasting tool includes charts of priority versus age of corrective work orders, and reports from online and manual condition monitoring data.

In summary...

Not surprisingly there is no silver bullet, and no metric to rule them all. Instead what we find are a range of metrics depending on what you are looking for and what you are trying to achieve.

There is also a different slant here on what a metric actually is. We used to think that it was a number that represented a trend, but it could just as easily be the age vs priority graph of corrective work orders out of the backlog.

Good luck...

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Reliability for every company

2009-07-05T15:52:00.000-07:00

During the great ERP boom of the 1980's and 1990's companies have been faced with two choices for their maintenance and reliability software.

1) An SAP style architecture, installed on their own servers and costing several million dollars to implement, or...

2) Some MS Access DB that was generated in house and is not scalable.

Don't misunderstand me, I am very aware of the ties between maintainers and their MS Access databases. In fact it could be said that many of us cut our teeth on MS Access as a way of dealing with recurrent maintenance problems of some sort or other.

But they don't scale too well sadly.

Fortunately there are software systems today that are changing this paradigm. Programs that are as useful, if not more so, than their expensive cousins and available for all of us to use.

1) My favorite online company eMaint. Pioneers in online CMMS, leaders in that field now, and showing the way for software/service providers who will come after them.

The whole idea of SaaS is relatively cheap per user pricing, full web delivered functionality, and data stored on a secure server off premise. (I am sure they can do on premise as well... but I am also sure that the need for that is bound to subside once IT managers get over themselves a little bit)

2) My new favorite Reliability Modeling tool - Raptor!!

A free version still exists online and I use it a lot these days for modeling and testing thoughts on various issues. For me, this is a must have addition to any maintenance practitioners toolkit.

Especially when you consider that commercial versions of this are available for around $10,000 plus these days.

3) Pump energy optimization tool kit. (PSAT) Another tool that I have used a lot in recent years, although nowhere near as much as I would like to.

This one is also free from the Department of Energy along with a range of other powerful energy management tools.

Have a look around at the internet and technology today. There are two very clear trends that are emerging in business software such as this. 1) Many of them are starting to be delivered online, and 2) They are increasingly cheap if not free.

I am dying for maintenance and reliability software to catch up with these trends. There was a bit of a chance with the free software that was doing the rounds recently, but it seems to have fizzled a bit for now.

Interesting time to be in asset management.

Check out the best roles in the game for maintenance and reliability professionals!

When is criticality analysis useful?

2009-07-04T18:56:00.000-07:00

When used correctly criticality analysis can provide companies with a very powerful tool for ranking their assets, prioritizing their workloads, and for managing their capital spending.

Unfortunately, in their drive to achieve these sorts of results, many practitioners have regularly misapplied criticality analysis. In fact, one could say there is a cult of criticality out there. Trying incorrectly to use some form of matrix approach to solve every part of their maintenance problems.

In some cases the results are relatively harmless, and the only negative impact is the tremendous waste of time. However, on other occasions misapplication of criticality analysis can produce results that are counter productive, dangerous and provide asset owners with a false sense of security.

I can't tackle all of the reasons why criticality can lead to these sorts of problems here, that would take a full chapter of a book, But there are some clear guides that may help avoid this int he future. .

1. Always and only at the level of the failure mode.

It is not uncommon to see "-practitioners" applying criticality analysis at the level of the equipment, assembly, or even at the level of the "principle functions". (Whatever they are)

This practice is not only uninformed, it is extremely dangerous.

You cannot know the relative importance of an asset unless you know what happens when it fails.

This means understanding all of the functions, all of the functional failures and failure modes, and all of their consequences.

Any criticality that is done without going to this level is destined to produce results that are lightweight, inaccurate, and potentially misleading.

Some great examples of Criticality analysis at work.

1. Prioritization of corrective work orders (Works arising from..)

2. The criticality matrix in RBI, risk based inspection, is always at the failure mode level.

3. Criticality analyses prior to performing a Safety Instrumented Systems project. This is relatively easy to do. Most safety instrumented systems have only one function, therefore the failure modes are relatively straight forward.

2. Never sum the answers

Comparing operational risks to safety risks is always where this sort of thinking comes unstuck. There seems to be a belief that we always go for the next highest criticality action or activity, when this is actually not true.

It is also impossible to produce anything (and I have seen a heck of a lot of these now) that truly gives you the capability to compare operational / economic and safety / environmental risks.

The tactics that is often used (erroneously) is to quantify the scores in every area of criticality, and them sum up all the criticality scores, then we are able to choose the highest, the next highest and so on. Sounds logical right? In fact, it has always been a very intoxicating argument.

But it is wrong...The results are often that low safety risks get treated before high safety risks because they also carry high operational costs, which catapults them to the front of the line.

The result? High safety being left in a high risks position.

The option...

a) Only score the highest one. The first one you come to.

As with an RCM analysis if you decide that the failure mode has an intolerable level of risk of a safety event, then that is how it needs to be managed. It's other consequences in environment or operations do not matter. Safety wins, every time.

b) Treat each failure mode according to its consequences.

So what do I do? I have an intolerable risk of a safety incident, and a failure mode with $10,000,000 attached to its failure. Which do I manage first?

Always the intolerable safety items. Then the intolerable environmental integrity elements. No need to debate, compare or work through a cost/benefits calculation.

Safety wins, get it to the tolerable levels. Then environment, get it to a tolerable level also. Then deal with the economic issues. Do not over complicate things.

Even the HSE out of Great Britain has come out against this practice.

3. Never as a filter!!! (Ever)

I have seen this applied two or three times now. Once was in the infrastructure industry of the UK, a second time in the electricity industry of North America, and third was an application of software in the mining industry.

The thinking goes something like this.....

Now that I have all my strategies (from RCM) and all my functional tests (from SIS) and all my replacement options (from say Availability Modeling) I now want to reduce all fo the activities to only those that are critical and require our further attention.

This is idiot engineering at it's best. Don't fall for this

The methodologies and approaches explained above will, for the assets they are working on, produce a safe minimum level of maintenance interventions. There is no further room for another layer of "optimization".

These types of approaches are usually developed and applied by people with only a scarce understanding of what asset management is about, and they are fundamentally dangerous. In fact, they are more likely to cause safety related incidents than an approach that does not use this foolish application of criticality analysis.

4. Prioritize where ever you can do.

I have ranted on this many times. But essentially it is unwise to use criticality analysis to determine which assets should be analysed, or which capital should be spent. Where you can it is far far better to use prioritization methods such as bad actors and AHP. (Which is fantastic by the way)

Good luck.

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An off the wall implementation plan

2009-07-02T18:15:00.000-07:00

Getting support for your reliability initiatives is one of the harder things to do. Not only that but there are persistent myths in this area that have hindered many companies in this area.

Developing your projects implemenation plan is not about following everyone else... it is about momentum!!

As a consultant, I recognize this - in fact, my career is based on being able to generate momentum in many companies at once. So here are a few things I regularly try to do.

1) Don't start with the critical assets.

The main problem with critical assets is... they're critical! Everyone knows they are critical, and when something goes wrong money pours out of the walls to fix them.

Critical assets are almost always working fine. (In terms of productive performance) IN fact, their most useful purpose is as a tool for consultants to use to separate clients and their money.

Instead start with the bad actors. Assets with proven history of poor performance that is costing the company money in terms of lost production. (Or direct costs if you really don't have production bad actors)

2) Don't do it alone. Easy one. You are never going to build momentum as a team of 1. projects don't need champions, they need a movement. And movements are started by very brave people, then joined by others.

3) It is not enough to do a good job. People will not notice. Not because they are selfish or self interested, but because they are busy. They don't have the time to stick their head up and notice that you and your team have just done an excellent job on your (say) RCM analysis.

You have to tell them that you are doing a good job!!!

Many people really shy away from this sort of thing. And I can understand it. It can be uncomfortable putting yourself out there and making the case for how wonderful you and the team are.

But if you don't, no one is going to get that message. If you do not blow your own horn...then sadly there is no music.

4) Quantify benefits from the very first day on the project. At all times your mind needs to be working on "how much value is this going to add, and how can I calculate that?"

Use the value quadrant approach. Revenue Increases | Direct Cost Reduction | Knowledge Increases | Risk Reduction. There are no other areas where maintenance and reliability adds value - so work through these, determine the cashable benefits on the table, and list the non-cashable ones also.

5) Be brave with listing of benefits. (Related to 4) it is easy to wimp out of this. But if you are standing in front of (say) a senior VP telling him that you are 70% sure to have saved $2 million over the next 18 months - what do you think his reaction will be?

"Come and see me when you are 100% sure"

Meaning? You just got another slice of the most valuable asset in the corporation. The time of your decision making leadership. Winner...

6) Get the lowest ranking person on the team to present to the highest ranking person you have access to. Nothing speaks louder about how to make change than this.

7) Measure and record the benefits. Publicize the results in short documents, notes and email links. Estimated benefits are great, real benefits are momentum builders.

There are lots more of these of course, but these are the key elements of successful initiatives. More than anything else - if you want to get the support of the senior leadership, then you need to talk about he things that keep them awake.

Profits, earnings per share, net present value and so on. Spend some time reading the Wall Street Journal for the terminology.

Remember, in times of great change companies will value people who can not only think of the ideas, but implement them. Be one of those people.

Good luck with your implementation plan!

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The risk payoff

2009-07-02T07:27:00.000-07:00

Maintenance is one of the more risk averse professions. Strangely, we are one of the management professions that has been most affected by change over the past thirty years also.

Even at the start of the 21st century the tendency to lean away from risk is pretty strong.

I have met maintenance managers who wanted to run the optimized RCM regimes alongside their old ones for a while to "see how they go".

The same mindset that makes managers who were adamant that the plant still needed to have the 9 month turnaround even though we had proved conclusively that there were no time based failures to deal with.

The reason is always the same, falling back on our unique responsibility for safety and performance. A valid reason, but often one that is misused and misquoted to win an argument. (You know what I mean)

But if we can learn anything from the entrepreneurial history of the past few years it is that a little risk often pays large dividends. In fact, it is often a tie breaker that sets the leaders out in front of the pack.

Here are a few small risks that you could take today...who knows, they might even make a huge difference to your bottom line.

1) Get rid of the expensive on-premise SAP style architecture CMMS you have been running with since the 1990's. (A long time in technology years)

The world is moving online. SAP realizes that their future is online. Oracle founder Larry Ellison has already dipped his toes in the water.

Instead of on premise, closed systems that require a lot of infrastructure and networking... have a look at eMaint. A pioneering company who have been online delivering Software as a Service since the 20th century. (Sounds like a long time when you say it like that)

(The risk... you could upset the IT dept. The benefit - You could upset the IT dept!!)

2) In fact, if you want a niche reliability system you can have a go at building your own now using the free software platform from Force.com.

3) Take a good resource off the front line, off the tools I mean, and use her to develop a comprehensive lubrication plan. From audit to execution. (The risk - you might not have enough resources to do the work! The benefit - you never did anyway)

4) Set up an internal mentoring program, possibly using recently retired employees, via DimDim.com or similar. (It's free by the way)

Good luck.

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A new epicenter for Asset Integrity, Reliability and maintenance professionals

2009-06-26T03:41:00.000-07:00

About two days ago LinkedIn announced that Group Owners could generate sub-groups to discuss specific themes..

For our group at Reliability Success this could not have been better news....

The area of physical asset management is gigantic and covers many areas, managerial disciplines and specialties. So as of today we have created 6 additional sub groups to cater to many of the different areas of asset maintenance.

The rules are simple. It is a professional (non-commercial) forum where there will be no spam, no unsolicited marketing and no "Accept all invites..." posts. Aside from that, our principle goal is to make it as powerful a resource for professionals in the physical asset management field as possible.

And for that to happen we need to make sure that we get a critical mass of members from throughout LinkedIn.

The groups are filled with RSS feeds from relevant blogs and newscasts, and we seem to have a pretty rigorous debate going on there most of the time.

The new sub groups are as follows:

Asset Integrity (Join Here)

All issues related to asset integrity. RBI, NDT, Finite Element analysis, replacement strategies, Safety Instrumented Systems and any other related theme.

Strategic Asset Management (Join Here)

Whole of life asset management, strategic frameworks, Asset performance management, PAS 55 and all issues related to the strategic end of physical asset management.

Asset Strategies (Join here)

From RCM to PMO and everything in between. The most contentious issue in physical asset management. Learn, contribute and hopefully get a chance to improve your skills and those of other

Condition Monitoring (Join Here)

For practitioners of all forms of asset condition monitoring from VA, to Thermography, to Oil Analysis and through to NDT and advanced NDT methods.

Maintenance Software (Join Here)

All issues related to maintenance software ranging from CMMS to APM, and including the big ERP/EAM systems and the niche RCM/Inventory management systems.

Planning and Scheduling (Join here)

Work orders, backlog, capacity scheduling and all issues related to putting together and executing high efficiency asset plans and schedules. (Including issues related to inventory management.)

I hope these groups add value to your work, your career, and our profession. Please let me know if I can do anything to improve them.

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What does "Pattern F" really mean?

2009-06-22T17:51:00.000-07:00

As time goes on there is no end to the amount of misrepresentation that I hear on the subject of the Nowlan and Heap six failure patterns and more importantly, what they mean to the maintenance and reliability profession.

(Download the N + H report here, but be careful it is big. (33 Meg) Best to use your right hand mouse button and click "Save link as" or something like that)

One of the more startling of these is some of the myths and legends out there surrounding pattern E, random or constant failure, and pattern F, infant mortality.

Myth 1: It still represents the vast majority of failures!

This was one of the ah-ha moments of the RCM study. The fact that 64% of failures were in teh early stages of life.

Infant mortality is caused by a range of factors. And here we have to remember where this information actually comes from...

When it was produced it came from the airlines industry, and painted a picture of a time a long time ago (In a galaxy far, far away)

In that time it was customary to take stuff out, pull it to bits, put it all back together again and reinstall it.

Issues such as design failures or quality issues are a major part of why assets fail early, justifying the need for pre-service inspections and NDT, but so too were human errors.

Failures in replacement, rebuild, installation and so on. You know the type - suddenly you have a vast number of spares when you reassemble it.

Today, however, this is less commonplace. Today companies are just as likely to use some form of condition based approach, (to manage their assets in general) or a fix on fail approach where it is viable to do so.

In my experience the number of burn in failures, aside from a few electronic components, is markedly lower than the 64% quoted by Nowlan and Heap. This analysis of Submarine data actually supports that. (PDF File) Even though this was nowhere near as rigorous as the original N&H report - it is still a good indication.

And if it points to anything... it points to Human Error (a La HEART type techniques) and reductions in over maintenance.

Is it still significant? Yup! Is it still the majority of the failure types you would have? Probably... but the percentages would be different in your industry and company than those of Nowlan and Heap nearly thirty years ago.

Human Error is emerging more and more as the rock sticking out of the receding tides of failure.

Myth 2: CBM is the best way to manage Pattern F

This is a wonderful scam for those wanting to hawk condition monitoring services. The reality is unfortunately never as simple as catch phrases and easy correllations.

It is generally used in conjunction with the myth above. Meaning - a) the boogey man is still out there, and b) you need lots of CBM to manage it.

There are two holes in this argument...

CBM is only, (ONLY) useful for predicting the onset of failure if the following is present: (It also has proactive uses, but we have posted on that recently)

1) A potential failure condition

2) A P-F interval that is reasonably consistent. (Keep that one in mind, it often gets overlooked)

3) A P-F interval that is large enough to actually do something useful. (To reduce costs or risk etcetera)

4) It actually reduces the whole of life costs, or reduces the level of risk to a factor that can be considered to be tolerable.

That's it. Is it useful for random failures? Definitely. But it is not the only task type. Detective maintenance is also very (VERY) useful for random hidden failures.

This ties into the second problem with this argument...

If most of them are failing in the early stages, so much so that there is a high likelihood of early failure - how can we be sure that the remainder are really random? And how many of the items that do remain are there anyway? Is this a significant figure?

So if you could eliminate the early life failure, we do not know which failure type the failures would end up as. Most of them die early remember!

As pointed out by Resnikov in his great work on mathematics and RCM, this is the fundamental reason why bathtub curves are so highly unlikely to exist at all!! (Be careful - 4 Meg download)

In summary

The way to deal with pattern F is through elimination of the causes of early life failure, not through CBM. Period! This means attending to human error, design issues, quality issues and over maintenance. (The last probably being the most prevalent)

CBM is applicable to random failures to detect the onset of failure, but only when the 4 criteria outlined above have been met. As with any type of failure mode! (But your wisest bet is (of course) to eliminate the early life failure first. Then it becomes one of the other failure types)

Sadly, it is almost always the case that people making grand statements like this, without more than theory or guessing to back them up, are doing so to sell something else totally. And not for the intellectual rigor of the reliability of the plants they are working on.

Even more sadly, it is often the case that they don't fully understand the theme also...

Check out the best roles in the game for maintenance and reliability professionals!

SaaS Software for Maintenance

2009-06-21T12:27:00.000-07:00

One of the most exciting things going on in the world today is the Software as a Service revolution in technology. This is an entirely new model of delivering technology via the internet which makes the software more economical, wrapped in a layer of high level services.

In recent time we have seen SAP, ORACLE, and Microsoft rushing into this area trying to capitalize on this new trend. However, before SaaS was a global trend, eMaint was in there pioneering a new way of doing business.Since the 1980's the eMaint team, led by Brian Samuelson, have been building new markets in terms of making maintenance improvement more affordable.

I recently caught up with company President Brian Samuelson about this area, and about his outlook for the future. Fantastic company, great vision - and I have always loved true dedication to service int he consulting industry.

Q1. Is the area of physical asset management benefiting from the global surge in interest in SaaS?

Absolutely! The benefits of SaaS offer substantial benefits over the traditional software models and users of EAM/CMMS are no exception in wanting best of breed applications, delivered in an on-demand environment, with a pricing model that is buyer-centric.

I believe the emergence of the term Saas (Software as a Service) over ASP (application service provider) actually illustrates at a high level why there is this global surge in interest – ASP sounds like a technology – perhaps simply a new way of delivering the same old thing – and in fact, many of the early entrants into the ASP market were simply quite that – delivering legacy apps over the wire via some sharing technology like Terminal Server or Citrix.

True SaaS vendors provide software and services in a model that, if done right, provide a higher level of value through the combination of service and product. There is a sales technique which has the salesperson ask the prospect if they were presented with a triangle and the three corners of the triangle represented Service, Quality, and Price – which two would they pick? I believe the value in SaaS is that the prospect doesn’t have to pick – SaaS delivers all three!

Q2. Commentators talk of SaaS being purchased at department level rather than at corporate levels. Is this the case with on-demand maintenance management systems?

I definitely see that department level purchasing of SaaS is leading the trend in on-demand EAM/CMMS. And why not?

Corporate decision makers take way too long in making those decisions and, more often than not, don’t make the resources available to the maintenance department (financial, technical, and personnel ) to properly implement legacy-style products. In the meantime, has the maintenance organization gone into “hibernation”?

Of course not – the potential realization of benefits from a maintenance management system only increase with time. So, the ability to reduce the overhead required to get started with a SaaS maintenance system along with often eliminating the need for capital requests is a perfect match for the predicament maintenance departments often find themselves in.

Q3. In other areas on-demand technologies have also opened doors for vendors to provide more outsourcing services than they have done in the past. Are you seeing this in your field? And if so, in which sectors or functional areas specifically?

In our case, when our customers realize that our SaaS mentality and delivery means that we are a service provider as opposed to a commodity provider, the doors begin to open. Customers will naturally ask any vendor who provides exceptional service – “how else can you help us?”

Consulting services ranging from CMRP consulting for assisting clients in the areas of reliability and efficiency, integration projects tying the maintenance system into the corporate level app (SAP/Oracle/etc), and extending the desktop into the mobile arena are some of the main areas that are well suited to be driven be the success customers are able to experience with the SaaS solutions they employ.

Q4. What do you think is missing in the on-demand space for asset maintenance?

I believe this is related to the question of the department level vs corporate level purchasing. I am optimistic that the next couple of years will really present opportunities that ARE driven from the corporate level. We are now beginning to make headway with corporate level decision makers who see the value in the SaaS model.

I suspect that the cost benefits combined with the increased acceptance of hosted solutions will continue to drive SaaS into the “boardroom”. Industry leaders like Salesforce.com are paving the way and we only see the acceptance levels increasing with time.

Q5. What is the future for eMaint in terms of continued expansion and growth? Are there other markets and sectors on the horizon for you or is there still space in your natural sectors now?

The good news is that the “natural sector” for eMaint is so large that there still exist huge opportunities for growth. We have put significant energies into relationship building with other providers in the maintenance and reliability marketplace and feel that those relationships will provide significant opportunity for growth. Time and again, we see the SaaS model as really providing an excellent platform for partnering with other organizations to provide value-added solutions to our customer base.

Our solutions have been engineered from the ground up for scalability and expansion – so our main challenge will be will be keeping up with the demand from a sales and marketing perspective. So that is an enviable position to be in.We continue to have subscription renewal rates over 90% and the great thing about SaaS is that the vendor who provides exceptional service will share in the rewards equally with the customer.

So while we are currently working on further expanding into areas such as mobile technologies and targeted consulting services – our core competency will continue to be service, service, service backed by a great software product.

Brian is one of those rare leaders who had a vision before most people even knew the concept. I really appreciate his time in answering these questions.

Check out the best roles in the game for maintenance and reliability professionals!

Cost cutting ideas - Energy usage

2009-06-21T12:22:00.000-07:00

Cost cutting is done with a scalpel, not a meat cleaver.

If you must cut costs and if you are responsible then you must, you need to do it controllably, without any adverse ramifications. You need to keep your eyes firmly on the prize of maximum cost effectiveness.

Europump is dedicated to energy efficiency globally and they regularly produce reports related to the issue of fluid transportation systems as they call them. (E.g. pumps right?)

In a report from 2005 (I think) they mentioned that 20% of all energy in Europewas consumed by pumping systems. Wow...

And, not satisfied with that "ah-haa" moment, they went on to state that around 50 - 60% of pumping systems were not running at their maximum efficiency.

The US Department of Energy has stated that 25% of industrial energy demand is for motor driven systems, and that savings of 20% in terms of energy efficiency is probable. The mind boggles!

The potential for saving on a multi national level is gigantic. And I am sure that this transfers to other countries, and plants all over the world.Energy efficiency is a good thing to focus on.

It saves money, and it reduces your company's carbon footprint. A win-win situation for all involved.

According to its website, where it offers PSAT and other free energy efficiency tools, The US Department of Energy claims:

ExxonMobil reduced its annual energy consumption by 11%
Nalco Chemical Company achieved reductions of about $142,000 annually
Alcoa has saved more than $1,500,000 by reducing its use of natural gas (260 million cubic feet) and electricity (2,500 MWh).

"Since the assessment, Alcoa...has identified opportunities to save at least an additional $50,000,000. To date, the company has completed energy efficiency projects to realize more than $10 million of those additional savings."

(http://apps1.eere.energy.gov/consumer/industry/others.html)

But there are even more benefits cases out there:

Inland Empire Utilities Agency wastewater treatment plant reduced their energy consumption by $57,000, per year. Maintenance costs declined by $14,000 per year.
Chevron made a cost savings of over $700,000 annually.

(http://www.pumpsystemsmatter.org/content_detail.aspx?id=116)

It takes money to make money, in some cases, and it takes money to save money also.This is not a time for unnecessary risk taking.

If it is proven, it works, and there is a significant pot of gold at the end of the rainbow, then this is the way to manage your company down the cost cutting curve.

Check out the best roles in the game for maintenance and reliability professionals!

Successful Project Management in Reliabillity

2009-06-21T12:11:00.000-07:00

1. Start with value in mind.

Successful projects start with the value in mind. This is where we fail often. We use criticality as a means of defining value, when it really doesn’t do that at all.

If we do criticality properly, and that is doubtful often, then it will define our most important assets – not our greatest value.

Focus on the Value Quadrant. Most companies look for revenue first, then costs, then risk and then knowledge. Make sure to tie it to your own company’s views and what your management thinks.

I might agree that risk is most important, or that knowledge is truly the most important. I might, but I am not paying the bills in your company. So get an understanding of what your management wants.

As a guide you need to be shooting for at least 10x the cost of the work. (Preferably a lot more)
Achieving success is easy, under promise and over deliver. That doesn’t mean you promise nothing.

You won’t get very far like that.

No. You promise a lot, and deliver a lot more.

2. Only productive work, no waste!

Focus, focus, focus!

I have been waging my own personal war against waste now for several years. What do you want to get out of this project, as defined by your value statements, and what is the best way to achieve that.

If you are implementing RCM it makes no sense at all to train everybody to a facilitator level. That’s waste in execution.

Instead focus on spending more time doing technical training with senior management. Keep your eye on the ball, and if the work doesn’t contribute to the end goal then cut it or don’t start it.

Once you have a budget in the millions, or even the hundreds of thousands, it is easy to start meandering all over the place. “But what about this” or “If we just did this as well as could get a lot more value” and so on.

It all sounds great, but it isn’t what you started out to do. In consulting we call this scope creep and it can be fatal to the success of the project. If an idea comes up that warrants additional work, then define it as its own mini-project, get approval and funding, and set it free.

3. Be Inclusive

You’ve seen this before haven’t you? That group of industry experts who are sequestered off into a far away part of the company for months on end. And then all of a sudden they turn up with demands on how you need to change!

Don’t become those guys!

Every part of the company needs to understand what’s in it for them. Or the value of the work, this is not a directive it’s a conversation!

Don’t demand change. It won’t work, no matter how important your sponsor is.

You need to convince them, just as you did with the sponsor, that this project will deliver outstanding value, value that it is worth having.

Then, and only then, start talking to them about what you need from them. Not before! If you don’t take this step then your initiative will be resented, your efforts will be resisted, and you will need to roll out the project on a “do it or else” basis.

And that’s not sustainable.

4. Tie it to wider strategic goals

If you are in physical asset management, in any industry, then your goal is to achieve minimum cost for a given level of performance and risk. Period!

When you bill it down it is that simple.

So you need to be able to paint the picture, very clearly, of how your initiative fits into the wider whole-of-life management. How it will aid the company to increase net present value and how it complement other initiatives in this framework.

We do not want to be part of the “program of the month” crowd.

5. Calculate, quantify and record the value

The default approach to value by many of my clients seems to be to go for statements like “to improve the efficiency” or “to reduce the number of failures”.

Unfortunately the approach of their boss is generally along the lines of “What’s it worth?”

I train my RCM facilitators to be thinking of benefits even before they finish the analysis. I train them to speak confidently about big figures, even if they are only 60% sure.

What will the boss say if you tell him that you are 60% sure that he will be able to increase revenues by $5 million over the next two years?”

“Come back when you’re sure”

Great, thanks! You just received the scarcest commodity in your company, the time of the executive leadership.

You need to be continually thinking about what value this will provide, quantifying it and recording it.

In fact, you should plan your project to release regular short bursts of improvement, which you can track and record to help build momentum.

Does it match where you started out from? It had better.

If it doesn’t then you were very wrong, or you lied. Either way you’re not in good shape now and you can only blame yourself.

6. Telling tales

It is not enough to do a good job. People need to be made aware that you are doing a good job!

If you’re anything like me then this area can cause heartache. We often don’t like crowing about what we have achieved, we don’t think we should be boastful, and anyway shouldn’t they already know?

Unfortunately, my experience is that generally they won’t notice. “They” (your management and stakeholders) are busy. They have many, many things drawing on their attention and they don’t often have time to look into things that are not on their radar.

So put it firmly in front of them.

As you get near important milestones you need to make sure people are aware of the value that you have already created. For example, this should be done at the end of every RCM or RCA analysis.

The temptation is to wait until the benefits are actually achieved. This is not the right way to do it. You need to be forecasting benefits, honestly, and telling everybody about them.

Some tips:

Get trained in presentation skills, not PowerPoint® skills but how to tell a story
Don’t just present facts. People are more receptive to stories. Put the facts in context. Wrap them up into an inspirational story. Stories get remembered, facts get questioned. Stories are entertaining, facts are often torture.
Get the lowest ranking person on the team to present to the highest ranking person you have access to. This isn’t just about you. It’s not a chance for you to be grandstanding. It’s a chance for your initiative to get noticed. This is very, very powerful.

7. Prove it!

Analyses by themselves do nothing. Any form of study does nothing without the action required to implement.

Implementation is where we all fall down very regularly. We do splendid analyses, train high level facilitators, and don’t focus on what happens next.

In fact, in times of great change companies will put greater value on people who can execute; not just come up with the ideas. Everybody has good ideas, few people can make them a reality.

Work processes, authorization processes, escalation systems, data management, involvement, continuous improvement. You name it. You need to think the project out all the way through, not just to the end of the analytical stage. Or just to the end of installing the online condition monitoring equipment.

And once it goes in, record the results. Prove that what you are saying is true. And, if anything, you were actually understating the value of the work you did.

People will trust you without facts. They will be persuaded that your initiative is worthwhile and that they should support you.

But if real world facts do not materialize in quick order, then it won’t last long.

8. Be persistent, reliability does achieve results!

This is probably the hardest lesson to learn.

It all starts well. The easy benefits are found, resolved and banked. The management are behind the project, and everything is smooth sailing.

Then you hit the rocks.

Implementation is harder than you thought. Management is concerned about the drain on resources.

The sponsor has turned her attention to the next big idea. It’s hard to keep going; you feel you are on the losing side. Don’t panic, don’t over extend, and don’t stop.

If it is well implemented reliability will achieve incredible results. The jury is in on this now, and today we know this to be a fact!

The reason why there are not many companies out there who have successfully implemented a value adding reliability program is because this is exactly the point where they quit. So don’t quit. Check you approach, adjust, change, and continue.

Reliability will yield great results. Your company will be far better off because of it, and you will be among the small number of successful professionals globally who have been able to do this.

Check out the best roles in the game for maintenance and reliability professionals!

Enterprise Risk Management

2009-06-21T12:07:00.000-07:00

John Moubray's article speaking out against streamlined RCM approaches was a watershed article. For the first time, Moubray spoke about the coming age of accountability for those charged with managing assets, and the need for defensibility in decision-making.

He was slammed by many at the time as a scaremonger, however, the reality has proved to be far more frightening than anything any of us could have imagined.

The Hatford rail disaster, the BP refinery explosion in Houston, and Buncefield explosion and the passing of the C-45 bill in Canada have proved, beyond a shadow of a doubt, that defensibility in decision-making should be firmly on the mind of any asset manager, or any company charged with managing physical assets.

That's the frightening angle, but there is another angle to this. One that is far more frightening for corporate executives, particularly in light of the recent financial meltdowns in the UK and USA.

For example, in Australia (and USA and UK environment is similar) the Australian Stock Exchange has released a guidance for companies called Principle 7. The thrust of this guidance note is to state that well-governed and well-managed companies need to have a functioning process in place for managing risk.

The guidance note specifically states that:

"Recommendation 7.1: ‘Companies should establish policies for the oversight and management of material business risks and disclose a summary of those policies’."

and...

"Recommendation 7.2: ‘The board should require management to design and implement the riskmanagement and internal control system to manage the company’s material business risks and report to it on whether those risks are being managed effectively. The board should disclose that management has reported to it as to the effectiveness of the company’s management of its material business risks’."

The implications of this are dramatic, and drives home two points related to risk management. First, that the often tactical approaches that we generally adopt are probably not enough to fulfill these requirements. And second, that there is probably a need for a larger registeration and management process for defining, reporting on and monitoring the material risks of a business.

In fact, their guidance notes point out that compliance with this area of corporate governance must be provable.

If you haven't already done so I strongly recommend that you check out Australian Standard AS/NZ4260. This is, as far as I understand it, the only existing globally recognized standard on how to create and implement a corporate process for the management of risk.

As Moubray pointed out, it is wise to be able to make decisions in an environment that can be defended if required. And it will be far easier to defend decisions made according to a recognised global standard than trying to explain the companies reasons behind choosing not to use such a standard.

I am working with a range of organizations today to try to implement corporate risk-management processes and systems. And it is challenging, to say the least.

One of the things that is proving significantly challenging is moving away from the child-like dependance on risk matrices that many in our industry seem to have, and moving organizations toward quantifiable risk profiles.

I don't think now is the time for dumbing down the discipline; now is the time for driving understanding deeper and higher into the corporate hierarchy.

Your thoughts are welcomed.

Check out the best roles in the game for maintenance and reliability professionals !