© Quality Digest Magazine/November 2005 Depending on which vertical industry or department you work in, the defi nition of “asset management software” can vary widely. From a maintenance perspective, names such as DataStream, AssetSmart, Mpulse and eMaint might come to mind. If, however, your primary focus is on compliance issues such as calibration, then you might think of Blue Mountain, Cebos, Cybermetrics and ASI DataMyte. The broad applicability of asset management has encouraged a tendency for individual departments to purchase or develop point solutions for their particular needs. This shortsighted approach limits the opportunity for strategic analysis of the service-and-suppoor capabilities protecting your most costly assets, and ignores the most costly assets, and ignores the cross-dependency of many assets and and services during their life cycles. This article discusses the need for an integrated asset managemeen system and the considerations the considerations involved in taking such a step. It also examines existing technologies that allow such an integration to take place. The term “asset managemeent is limited here to manufacturing environments, including all production-process assets such as mechanical and tooling. maintennanc equipment and parts inventories, and measurement gages, and any other assets used to support the manufacturing process. Shifting focus from task to asset Although most legacy software systems on the factory fl oor focus on repair, changeover or calibration, it’s important to rememmbe that an “asset” is the core element, and service and tasks are merely activities or events that contribute to documenting the overall cost of ownership, system governance, maintenance and compliance programs. Companies invest millions of dollars in assets for production facilities, including manufacturing machinery, test equipment and Asset Management Seeing the Big Picture 100 E Michigan St, #200, Saline, MI 48176 tel 888-577-2797 · fax 734-527-6145 info@latitudecg.com · www.latitudecg.com Know and Go • Significant reduction in service-consumable inventories requires a cross-process approach to asset-service management. • Tracking for tooling, gages and other portable, durable assets used in service and productiio provides real cost-reduction opportunities. • Reducing tool spend and service inventory increases working capital availability for new technologies that drive additional cost reductions. • Cross-facility visibility and access to service inventories within the asset-service process will significantly reduce enterprise maintenance expense. • Automating the replenishment of predictable spend items such as consumables reduces administrative costs and increases resource productivity.© Quality Digest Magazine/November 2005 human capital. Consolidating real-time and historical service data from the disparate software systems that manage assets can help optimize an organization’s potential in the following ways: • Increase production volume predictabiliit • Reduce machine downtime and increase productivity • Synchronize activities to decrease redunndan costs • Increase turns of mission-critical parts inventory • Reduce standing parts and consumable inventory • Reduce redundant software and databaas systems For example, if a specifi cation or work instruction is required to perform a task within one system, it shouldn’t require reenntr or manual cut-and-paste to another application database to make it visible to that application. Common procedures and specifi cations should reside in one place and be available to all other applications that need that same data. Cost savings can be realized by eliminating redundant dataenntr operations as well as by increasing data reliability. By consolidating redundant information and selecting software systems that track activity-based costs around the asset itself rather than the type of work being perforrmed an organization will increase costreduuctio opportunities across multiple disciplines in the management process. The company might actually reduce the number of software applications, databases and administtrativ resources required to maintain a healthy asset program. From a software-technology perspective, the process required to keep tactical assets of any type available and functioning are basically the same, regardless of the type of service or support activity being perforrmed The process includes: • Identifying the physical asset that requiire service activity • Specifying the activity to be performed and who shall perform it • Providing the task-specifi c information required for success • Providing necessary supplies equipment • Managing the information resources during the process • Documenting the process and assessing related effects • Analyzing opportunities to prevent negative recurrences The more asset life-cycle data are centrallize and made available to all support personnel, the more effi ciently they can assess a situation and execute their duties based on facts. This results in a positive. cost-effective outcome. Lab and calibration systems for examplle don’t always have access to preventive maintenance or line-changeover schedules. The lack of manufacturing visibility to the calibration lab prevents it from easily synchronnizin calibration schedules to minimiiz equipment down-time and avoid dupliicat or redundant effort for activities that could been scheduled concurrently. When internal facilities operate as suppliier or customers of one another. it’s good business to synchronize downtime across facilities to soft spots in production performaanc that could affect other facilities’ producctio capability, delivery and profi tability. Focus on the Basics Before considering any new software soluttion you must fi rst understand your asset management requirements across the entire organization. For each type of asset (e.g., equipment, gage, personnel, vehicle, etc.), you must address the following: • Asset tracking. Where will the organizaatio manage and track data about a particular asset? What’s the primary information system (i.e., application) used to manage this asset? Is this system capable of maintaining the overall asset life-cycle management data? • Operations and service . Review each service-and-support software system for data and compliance requirements for internal governance, customer audits and regulatory issues. Focus on redundaan data elements and administrative tasks, and develop open architecture that allows for easy data exchange with other third-party applications. This is a key to reducing administrative redundancy on the factory fl oor. • Systems that support services . Creaat an environment that will promote “enterprise-asset awareness” vs. departmennta ownership. Think outside the box (or department) and analyze service inventories by use, owner, location and critical response requirements such as maintenance or changeover consumablles tooling and equipment standards used for calibration. Separate the more predictable services from those that are ad hoc, critical and unpredictable. The goal is to automate events that can be eliminated from the administrative work-fl ow and thereby reduce resource drain. © Quality Digest Magazine/November 2005 Pulling it all together Many new technologies now provide the ability to access and consolidate data and information in disparate application databasees This allows us to leverage legacy data to serve new investments in software. Such rules-based technology tools offer open access to, and data-mining capability from, almost any ODBCcompplian or SQL database; some even offer data extraction from ASCII fi les and proprietary databases. These tools come in a variety of packages, from Microsoft’s BizTTal Engine, whose application capabilities include establishing rules for initiating decision support activities, to more analytically focused, executive dashboard-development tools such as eServer by Statware, which specializes in analyzing custom data sets deriive from data extracted in real time from multiple application databases. By using XML “triggers” when data are altered, the BizTalk engiin is capable of enforcing the exchange of data requirements between applications such as maintenance, repair and operations (MRO) software, and calibration software to eliminate manually re-entering and updating asset information. Any new asset or updaate information can be entered automatically into any number of application databases containing the identical fi eld requirements for data. The eServer could be confi gured to identify and analyze trends or potential confl ict issues across processes or within multiple applicaations Examples include synchronizing activities relating to a single asset or assessing machine downtime for root cause and preventable redundancy. The software can be customized easily to assess the probability of redundant downtime between several indepeenden application schedulers that might require machine shutdoow for service, and even notify and recommend synchronizing activities to the appropriate parties. These enabling technologies automate the process of informatiio fl ow, or redundant administration, based on existing data or what can be extrapolated from them. These tools also support basic autodeciisio making and notifi cation to responsible parties when a consistent outcome is observed based on the analyzed data. Whether the technology is considered a reporting tool, dashboard or data-mining engine, the primary goal is providing contextual information where you need it, when you need it. Suppliers that develop these technologies are usually willing to demonstrate their capabilities using the customer’s internal data sets. Case study: Dynamic Technology Inc. Any outsourcing service carries with it the inherent risk of decentrallizin necessary compliance information and making fi nancial or compliance audits more complex, costly and time-consuming than necessary. In no arena is this more apparent than outsourcing instrument and gage calibration, and the service and/or repair of electronic and mechanical equipment, including warranty service contracts. Every supplier that performs a service generally offers to proviide via Web interface to its systems, necessary compliance documenttatio such as calibration certifi cates or detail sheets of work performed. Unfortunately, by its very nature, outsourcing distributte a client’s service data to other systems beyond its control. Retrieving the necessary documentation (not necessarily with supporrtin data) must be done on the client’s time from data stored off site. From a comprehensive, asset life-cycle management perspecctive this method offers no analytical capability or correlation to the organization’s involved assets. From a system perspective, outsourcing can be a less than optimal, sometimes even counterproduuctive method of data collection that could expose an organizaatio to higher risk and additional costs while offering less visibiilit and control. The answer lies with an overall asset service tracking and manageemen philosophy, similar to that of Dynamic Technology Inc. of Hartland, Michigan. A premier service provider for outsourcing calibration, service, and repair of electronic equipment and instrumentaation DTI enjoys relationships with more than 80 percent of the top 50 automotive manufacturers, primarily due to its unique total asset management approach to service. When faced with providing the best possible service to its worldcllas clientele, DTI asked its internal development staff to fi nd a method for leveraging its sophisticated cross-functional software technology to accommodate its customer base. DTI has combined calibration, service and repair management into a single, assetspeecif c service focus, so that all data regarding a specifi c asset, including the supporting documentation, is available online, in a single history, with associated costs and raw data components available for download to the customer’s site for review and analysiis This asset life-cycle information capability is available to all DTI customers. DTI’s online service also provides customers with the ability to use the DTI online software to facilitate the same high level of service and compliance tracking at their own facilities for equipmeen and machines outsourced to other service suppliers. This allows customers to consolidate all their asset service and repair activity in one database for future auditing and analysis, without investing in new internal servers and software. By using their own Web browsers to access the DTI system, the company’s customers get the same level of service as that provided by multiple legacy software systems, for a price much lower than what it would cost to maintain those systems, not to mention the resulting time saved performing internal or customer audits when all the information is stored in one place. The DTI system offers not only centralized service data for the assets it manages for customers, but also provides an additional capability for consolidating other service data on these managed assets, such as internal preventive maintenance or mechanical repaai and/or overhaul that are part of the assets’ overall life-cycle © Quality Digest Magazine/November 2005 history. All data are stored in one system for easy access, review and analysis. Moreovver having a consolidated asset-service management system reduces the need for operators to learn multiple systems for calibrattion service or repair activities. Case study: Dispense-Source Inc. DePuy Orthopaedics, a Johnson & Johnsso company, recently identifi ed cost-reducctio opportunities within the process that distributes and manages its service invenntor and tooling supplies. All consumabbl inventory was dispersed from a centrra crib area, requiring multiple resources and excessive inventory for stock outs and potential machine downtime issues. In addittion operators created their own “privaat stock” inventories for tooling, which skewed the true consumption numbers, making accurate assessment and reorderiin almost impossible. Machines had to be shut down two or three times a day for trips to the crib area, and with more than 200 operators, this added up to a serious loss of productivity. To reengineer the consumabble supply process, DePuy’s management team set fi ve basic goals for improving the process: 1. Reduce machine downtime due to operaator waiting for tools and/or supplies. 2. Ensure around-the-clock access to all materials and supplies. 3. Reduce on-hand inventories and eliminaat private-stock overages. 4. Require increased accountability from employees for tool and/or supply use. 5. Substantially increase reporting accuraac for replenishment and purchase. DePuy selected its largest internal businees unit to pilot a point-of-use dispensing solution by DispenseSource Inc., a fullserrvic solution provider of Web-based systems for managing service and support inventories. The pilot system was set up to provide operators with 24/7 access to the tools and supplies required to do their jobs from a series of networked dispensing cabinets instaalle in their own departments, thus eliminaatin the time spent walking to the crib. The networked units provided accurate, upttothe-minute inventory control numbers directly to purchasing and accounting, and extensive reporting capability for managemeen review. In addition, the system’s Web-based executive reporting and real-time data integrratio capabilities allowed DePuy to leverage its legacy purchasing system, automating the purchasing process for all supplies and tooling dispensed from the point-of-use cabinets by issuing replenishmeen orders directly to the relevant supplier through a Web-enabled link. As inventory levels reached replenishment thresholds, the supplier would be notifi ed automaticaall to initiate a shipment against its blankke purchase order, which in turn triggered the supplier payment process with notice of shipment. The loop was closed by automaatin redundant activities between applicaations After a three-month pilot test, the results were impressive: • Standing inventory time was reduced from three-and-a-half months (represenntin approximately $119,000) to slightly less than two months (approximattel $81,000) during the pilot, and continued to decline to less than two weeks after the rollout. • Machine downtime fell from approximattel eight hours per week to less than two hours per week during the pilot, and continued to fall to less than one hour per week after the rollout. • Out-of-stock adjustments and resulting “response orders” fell from more than 600 per week to less than 100 per week, and continue to decline. • The purchasing department signifi cantly reduced the hours required to administer the process by automating the supplier interface. After three months, the pilot program had outperformed expectations. “Any skepticiis as to whether the point-of-use cabineet could make a real difference faded aftte less than two months,” says Dick Perry, DePuy’s manager of strategic MRO. Perry credits the system with an ongoing reductiio in tooling expenses of nearly $250,000 per year, in addition to a return on investmeen several times that which the company expected. Summary Traditionally, each department or functioona unit had its own method of monitorrin asset management, with little or no data-sharing, automated or otherwise. The result was a task-driven asset-management system that provided no overall view of an asset’s life cycle. Technological solutions are available for creating asset-management systems that provide complete asset life-cycle visibiilit and that also integrate data from an organization’s legacy point-solution asset software into one dashboard. In addition, technologies such those produced by DispenseSource allow for automated assse handling and procurement. Production asset management is becomiin an integral component of business strateggie to achieve competitive advantage and stakeholder value, and therefore any underttakin to develop an asset-management system must be based on sound business principles coupled with sensible technoloog investments. Effective asset-management systems have strong business justifi cations, with returns often measured in the range of ten times cost. In addition, the residual benefi ts of using a fl exible, scalable system that can evolve with an organization’s individual needs will far surpass the original savings from the core technology. About the author Cliff Veach is a well-known functional software design and marketing strategist whose design concepts have won several notable industry awards. A contributing author in the areas of asset management, performance optimization and supplierquaalit relationships, he co-authored the SME Blue Book on Technology Trends for 21st Century Manufacturing. Veach has also served for several years as an executiiv advisor to the Computer and Automatee System Group (CASA) of the Society of Manufacturing Engineers (SME). He’s currenntl a manufacturing systems associate with Latitude Consulting Group 100 E Main St, #200, Saline, MI 48176 tel 888-577-2797 · fax 734-527-6145 info@latitudecg.com · www.latitudecg.com