AMEU 60th Convention – Phezu Komkhono Physical Asset Management as a Profit DriverA Back to Basics Approach Dean Griffin Divisional Manager – Utilities & Facilities 17th October 2007 – Durban ICC Overview Introduction The Challenges at Hand Lack of Maintenance Effective Utilisation of Resources Asset Management as a profit driver? The Way forward Introduction Asset Provision – making sure that the most appropriate asset is acquired for a specific application and also making sure that the asset is effectively disposed of (in a responsible manner) at the end of its useful life. Asset Operation – making sure that assets are operated in the most appropriate way that allows the asset to perform to its maximum capacity. Asset Care – making sure that assets are looked after in the most appropriate way that will ensure continued performance at its originally intended design capacity. The Challenge at hand Visible - Direct Labour, Materials, Operation, & Contracts Poor asset reliability and performance Waste through inefficient processes Poor teamwork Lack of Communication Between Groups Incidents, Reputation Damage, Recovery Costs Hidden - Indirect Current Challenges Backlog Maintenance estimated at R 5 Billion Labour Shortage / high turnover Most organisations have organisational gaps at all levels Poor Asset Reliability Low Public Perception of service Lack of Asset information Inaccurate Asset information Under estimation of Asset Value Quality of Work 3-4 years of capacity problems ahead Complexity of solutions employed Lack of Maintenance There are 2 types of Maintenance What we say we are going to do What we actually do Maintain the Maintenance Program New Tasks Maintenance Program Maintains the Assets Tactic creation performed by consultants or by in house staff RCM, OMM, BCM etc Technical ability is high Developed tactics are comprehensive Current Breakdown and Ad hoc items Proactive tasks are scheduled weekly Schedule attainment is often low due to reactive interruptions Comprehensive IT management systems are in place Maximo, On Key, SAP, Ellipse, GIS, MIS, Reporting tools, Scheduling tools Good Tasks Managed Failures No Effect Refurbishment programs exist Tasks in place Failure Modes Lack of Maintenance cont Preventative tasks are established with the best intentions However!! Organisational Culture invariably rewards reactive actions when problems arise ‘You worked through the night to get the supply back’ well done! ‘My team know how to pull out all the stops when the chips are down!’ When did you last hear this sentence? Well done for that inspection, we haven’t had a failure in the last 6 months! BP/KPI Maturity Matrix PERF. LEVEL 5 RESULTING KPI PERF. LEVEL 4 Can’t go the distance PERF. LEVEL 3 PERF. LEVEL 2 PERF. LEVEL 1 Back of the pack STAGE 1 STAGE 2 STAGE 3 Promising STAGE 4 STAGE 5 ENABLING Best Practice Barrier removal World Class contenders Lack of Resources Most organisations have gaps in their resource structures There is a country wide shortage of skilled labour across all industries Refurbishment funding has been made available in a number of cases There are no quick fixes to plug the organisational gaps As Engineers we compensate Over engineer and / or automate Implement complex technical solutions Outsource Lack of detailed planning, Scheduling and Execution management People are asked to perform tasks that they should not (Planning, expediting etc) The level of actual job supervision is often low Mainly due to constraints on supervisors to perform administrative duties, chasing tools, materials, labour Not enough time in the day to inspect work which results in artisan acceptable quality Lack of Resources Available Workforce Simple WP&C in Context Asset Register Planned History WP&C Condition-based Feedback Scheduled Work Orders Execution Resources Data Collection Work to be done Resources available Lack of resources or low utilisation? Wrench time is the measure of productivity within the workforce Average wrench time for industry is between 25 -35% For a 10 hour day the person is productive for 3½ hours. Non-productive activities account for 6½ hours. • Necessary break times • Job delays • • • • Waiting for spares Waiting for instruction Travel Waiting for Tools World class wrench time is between 55 - 60% Implement a fundamental planning & scheduling system – 45% Keep records and learn from previous mistakes – 50% Detailed Asset register & CMMS – 55% What does it mean? Misconceptions Being busy is not necessarily being productive or effective Labour is invariably busy Lets put in terms of people and cost If we can take the productivity of a person from 35% to 55% by adding a planner then a planner increases productivity by 1.57 Breakeven point = take 1 of every 3 workers and make them a planner Without Planner = 3 x 35% With Planner = 2 x 55% & 1 x 0% = 105% productivity = 110% productivity Experiences states that a planner can plan for between 20 & 30 people Therefore for a 30 man workforce 1 planner adds 17 extra workers making an effective total of 47 workers without adding heads. What does it mean? If you take 90 workers the you get an effective headcount of 141. That’s 51 extra people!! If the organisation is predominantly reactive in nature then the workforce can be split into a proactive team and a reactive team. The majority of the people reside on the fire fighting side initially The ratio of the split can be adjusted as the organisation moves from reactive to proactive. In a more proactive organisation the extra pople can be used to perform tactical tasks ensuring fires don’t occur. In world class organisations where reactive and proactive work is well in hand then the extra resources are used for training and development of processes or projects to further improve the performance of the assets. AM as a profit driver Indirect benefits If we have an effective support or care function then we should be performing the right task at the right time to the right quality at the right frequency. Reliability will be high as will availability Customer perception will change Impact on industry and business will be reduced Direct benefits Maintenance backlog is reduced Capital investment can be deferred Saving in cost to perform maintenance due to planning & scheduling More engaged work force Lower turnover Example - Jacksonville Electric Authority In the late 90’s at Jacksonville Electric Authority in the USA the following was found For their 1000Mw steam system 1% increase in availability equated to $300 000/yr power transaction capability Each 100 Btu/KWH improvement in efficiency equated to $400 000/yr 1% increase in availability for 1000Mw system means 10Mw of future power plant that does not have to be built. At $1200/KW construction prices that equates to $12 Million Reference - The Leverage effect of Work order Planning – R.D. (Doc) Palmer, Jacksonville Electric Authority The way forward - Asset Care Centre Methodology Performance Improvement Technology People Asset Base The way forward - Asset Care Centre ACC Methodology Performance Improvement Reactive Urgent work Technology Asset Base People Feedback Planning & Scheduling Feedback Execution Control (Supervisor) Execution (External) Execution (In-House) …..and finally Thanks & Questions? Can you do it again?
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