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Management and Organization
1
Management and Organization
• Leadership
– Business Plan Fit
– Vision, Mission, Policies and Objectives
– Strategic Plan
– Measurable Goals
– Resourced Action Plans
– Communication
• Organization of the M&R Function
• Implementation Process
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Leadership
•
Change the way management views the role of maintenance
– Cost center vs. profit center ( giving responsibility and accountability for
contributing to the overall profitability of the corporation)
– Attitudes toward maintenance are shown by the way it is treated when it
comes to dedicating resources (proper tools, proper locations, consultation on
purchasing equipment decisions, and incentives to work)
•
Change how maintenance perceives its role
– From repairing and maintaining ( reactive, “fire-fighting” mode) to preventing
the need for maintenance (proactive, fix-it-right-the-first-time approach); from
a repair culture to asset management culture.
– Work with design engineers to “design-it-right-the-first-time”
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Maintenance as a Business Center
•
Positioning Maintenance as a business center within the plant
•
Recognizing and measuring impact on product quality, delivery, and plant
profitability
•
Developing new measures of functional performance
•
Re-organizing the maintenance function to provide accountability and
responsibility for achieving these new levels of performance
•
Strategically investing in new maintenance technologies as the tools of change
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Role of Maintenance
•
What is the role of maintenance and reliability operations in management’s
policy and goals for manufacturing competitiveness?
Management’s policies include:
– Product quality
– Flexible manufacturing for time-based competitiveness
– Schedule stability
– Inventory and materials performance
– Overall cost leadership
– To achieve world-class maintenance if any of the above is to be worldclass.
– Schonberger’s WCM consists of JIT, TQC, TPM, and EI
In order for any of the above to be “world class,” then asset reliability must
also be world class.
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Evolution of Expectations in Maintenance
2000
1990
1980
Year
Third generation
• Higher plant availability & reliability
• Greater safety
• Better product quality
• No damage to the environment
• Longer equipment life
• Greater cost effectiveness
1970
1960
Second generation
• Higher plant availability
• Longer equipment life
• Lower costs
1950
First generation
• Fix it when broke
1940
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3
Asset environment
Business Strategy
Global Objectives for Plant
Engineering and Maintenance
Current Status
Performance Gap
Vision
Performance
Drivers
Maintenance
Strategy Model
Mission,
Mandate
Guiding Principles
Source: Uptime, Productivity Press
Tactics
Concepts
Organization
Arrangements
Education,
Training
Systems,
Procedures
Methods,
Tools
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Current Status
•
Assess thoroughly the strengths and weaknesses of the present system and
which areas should head the list for improvements
•
Diagnostic must be a clear roadmap of the next step to achieve the vision
•
Diagnostic should cover strategic, procedural, technical, administrative, and
cultural issues
•
Diagnostic may be performed by an outside consultant or in-house by a selfadministered questionnaire.
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Current Status
•
•
Major areas of this review are:
– business characteristics
– maintenance environment and strategy
– organization arrangements and human resource management
– maintenance administration
– planning
– scheduling and work order management
– preventive and predictive maintenance
– purchasing
– storage and inventory control
– performance measurement and customer satisfaction
– automation and information technology.
Each response is scored and results can be plotted using a histogram or a
Bell-Mason type spider diagram
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Maintenance Self-Assessment Results
I. Maintenance
II. Organization and
Administration
III. Work Order
System
IV. PM and PdM
70
60
50
40
30
20
10
0
V. Performance
Monitoring and
Reporting
VI. Stores and
Purchasing
VII. Cost Control
VIII. Safety &
Housekeeping
IX. Maintenance
Engineering
X. Training
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Maintenance Self-Assessment Results
Maintenance and
Repair
Reliability
Engineering
Maintenance
Strategy and Plan
100
80
Integrated Support
Services
60
40
20
20
40
60
80
100
Performance
Management
Management and
Organization
Human Resources
Business Perspective
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Develop the Vision
•
The vision is a dream of what the company wants to be
•
The intent is to develop a reliability improvement plan to move the organization
from the current reality to the vision
•
Main goals must be based on the overall business plan
– maintenance goals should be integrated into the business plan, otherwise
maintenance improvement remains just another tactic that can be jettisoned at
the first sign of need for “cost reductions”
•
Benchmarking can be used as a tool to understand what are “best practices”
•
Those involved for achieving the vision should be involved in the maintenance
plan
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Closing the Gap, Planning
Implementation
Devise a plan which considers:
• The task and its key activities
•
The priority of the initiative, relative to others
•
Estimated resources and level of effort required
•
The “champion” or person/team responsible for ensuring successful completion
•
The start date, completion date, and the milestones along the way
•
The goals to be achieved on successful completion, and the performance
measures used to control progress
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Mission of the Maintenance Function
• Is a primary benchmark for effective staff decision-making
• Covers the issues of customer orientation, continuous improvement,
quality, safety, environmental position, employee development,
downtime, proactive stance, etc.
• Example of a mission statement:
“To maintain assets to meet customers’ needs cost effectively; to
continuously improve skills and processes to optimize asset life, using
best-fit models and technologies; to work safely and be
environmentally responsible”
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Goals and Objectives
• Maximum production or availability of facilities at the lowest cost and
at the highest quality and safety standards
– Maintaining existing equipment and facilities
– Equipment and facilities inspections and services
– Equipment installations or alterations
Example:
Increase production capacity by:
– Reducing unplanned equipment downtime
– Reducing planned equipment downtime
– Reducing volume of off-spec production
– Increasing production speed
The goals should be shared with the operations function.
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Goals and Objectives
Examples (cont.):
• Identify and implement cost reductions (e.g. reduce maintenance costs
by:
– Identifying/correcting machine problems before they become too
serious
– Improving maintenance troubleshooting
– Improving personnel efficiency
– Reducing maintenance parts inventory
– Identifying and replacing poor maintenance practices or
procedures
– Improving personnel skills and performance
• Provide accurate equipment maintenance records
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Goals and Objectives
Examples (cont.):
•
Collect necessary maintenance cost information
•
Optimize maintenance resources
•
Optimize capital equipment life
Example: Reduce capital expenditures by:
– Extending equipment life
– Making better repair vs. replace decisions
– Installing equipment with best cost/performance ratio
•
Minimize energy usage
•
Minimize inventory on hand
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Goals and Objectives
Examples (cont):
•
Minimize the need for maintenance (this is an equipment engineering function,
not necessarily just a maintenance function)
•
Ensure the satisfactory performance of contractual maintenance services
•
Improve worker safety by:
– Reducing the number of serious or critical failures
– Increasing planned maintenance (fewer emergencies)
– Improving housekeeping
•
Improve the work environment though enhancement of personnel skills,
technology implementation and automation of information systems
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Policies
• Essential link in guiding everyday activities to ensure consistency with
the overall concept of maintenance
• Examples of maintenance policies:
– Each operations manager will ensure compliance with the policies
covering the conduct of maintenance
– Operations will be responsible for the effective utilization of
maintenance services
– Maintenance workers will be responsible for the quality of work
and the effective utilization of resources
– A work order system will be used to request and control work
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Policies
Examples of maintenance policies (cont.)
•
– Maintenance will publish priority-setting procedures which allows other
departments to communicate seriousness of work and maintenance to
effectively allocate its resources
– Performance indices will be used to evaluate short-term accomplishments
and long-term trends
– Parts will not be removed from any unit of equipment and used to restore
another unit to operating condition without discussion
– All maintenance personnel will be trained on maintenance techniques.
Periodic evaluations will be made to ensure personnel are proficient
Procedures are the out-growth of policy. They specify what must be done and
how to do it in order to meet policy guidelines
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Management Maintenance and Reliability (M&R) Strategy
Principles
Strategy
Goals
Plans
Resource Allocation
Maintenance Dpt.
Operating Units
Engineering
Goals Plans Resource
Allocation
Goals Plans Resource
Allocation
Goals Plans Resource
Allocation
Results
• Reliable Equipment and Processes
• Operating Cost Reduction
• Maintenance Cost Reduction
• Greater Productivity
• Improved Safety
• Less Waste Generated
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The Production/Maintenance Interface
• A great source of conflict is the problem of communication between
the production and maintenance functions.
• A recent European survey showed there is a controversial trend
towards a greater integration of maintenance and production control.
European management favored a move toward the following structural
changes:
– Maintenance to come under the production director
– Less production personnel, but more maintenance personnel that
are also responsible for output (maintenance operators)
– Closer cooperation with production, with production more
engineering oriented.
– Common information access via computer
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Concepts of Good Maintenance
• No one unit can function in a satisfactory manner entirely on its own
an/or without the support of other units (interdependence exists
between units of the organization).
• Ultimate responsibility for continual good condition of operating
facilities rests squarely on the shoulders of the maintenance user and
repair service. This means that decisions on the nature, scope and
volume of work shall be made by the operating departments.
• Responsibility for cost levels of maintenance work is shared jointly by
the equipment owner (decide volume and timing) and the maintenance
personnel (provide quality and speedy performance)
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Elements of an Effective Maintenance
Program
1. An established planned-maintenance philosophy that is communicated,
understood and reinforced. (vision, mission).
2. Formalized plan for continuous improvement with established goals
and objectives which focus on: people, equipment, material, methods.
Successful plants typically have a five-year strategic plan with defined
objectives and internal commitment to the plan: performance measures
to evaluate progress; a focus on equipment reliability; and, personnel
practices that provide recognition for exemplary performance.
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Elements of an Effective Maintenance
Program (Cont.)
3. A site maintenance network whose task is to set expectations and monitor
performance for continual improvement and effectiveness in the
maintenance function. ( Network contains representatives from
operations, stores,central services, etc.)
4. Measurements of business results (quality, productivity, profitability,
safety and environment)
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Elements of an Effective Maintenance
Program (Cont.)
5. Measurement of overall maintenance results:
- labor productivity
- material management effectiveness
-contractor effectiveness
-planning and scheduling effectiveness
-reliability engineering effectiveness
-predictive/preventive effectiveness
-training program effectiveness
6. Commitment for increasing the involvement of all levels of the organization (
task teams, operator-based maintenance, etc)
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Maintenance Organizational Structure
• Centralized maintenance: Maintenance services are managed and
scheduled centrally.
– All members report to a central location for assignment
– All work requests are turned into a central area for scheduling and
dispatch
– High labor force utilization
– Response time to trouble calls can be long, contributing to
increased equipment downtime
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Maintenance Organizational Structure
•
Area maintenance: Maintenance services are managed and scheduled by area
– Existence of small maintenance shops spread throughout the plant. A
certain number of employees are assigned to each area
– Supervisors assigned to cover one or more areas, depending on the
number of employees
– Faster response for breakdowns, since maintenance personnel are
physically close to the equipment.
– Maintenance employees develop “equipment ownership.
”
– Labor utilization can be low, allowing for more predictive work.
– If all areas have the same workload, the area concept can work
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Maintenance Organizational Structure
• Combination organization: Hybrid between area and centralized
organizational structure.
– Incorporate the best of both organizations Several small groups of
employees are stationed near critical equipment, while keeping the
main group in a centralized area.
– Emergency activities are handled quickly, while most of the
maintenance personnel can be used for larger or scheduled repair
jobs
– Combination organizations appear to be the way of the future.
– The concept of operator-based maintenance (TPM), where
operators are responsible for maintenance of equipment they are
assigned to operate, and use of maintenance craft workers are
needed for more complex maintenance jobs is similar to a
combination organization
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Maintenance Organizational Structure
Example: A microelectronics plant in the midwest of the United States
is divided into four focused factories and 60 production cells.
The maintenance structure agreed upon by maintenance and operation
managers was:
– Central maintenance for facility maintenance (HVAC, etc), stores
inventory warehousing and control, fabrication and machine shops,
tooling, information database control, and specialized trades
training
– Focused factory maintenance for workshops, planning and
scheduling, operator training in maintenance
– Cell maintenance for multi-skilled teams, urgent maintenance,
preventive maintenance, free issue parts and supplies
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Advantages and Disadvantages of
Different Maintenance Structures
Centralized
Area
Combination
ADVANTAGES
DISADVANTAGES
Skills and technology
easily desseminated
Collaboration with operating
department difficult
Problems easily investigated
Incomplete collection of operating data
Good communication with
operating department
Difficult to share technology and skills
Speedy maintenance response
Requires more people
Good communication with
operating department
Skills/technology dissemination
and problem investigation possible
Job rotation difficult
Management somewhat difficult
Job rotation requires ingenuity
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Preferred Organizational Structure
• There is no correct organizational structure. When looking at structure,
it is important to keep in mind the ultimate objective of the
maintenance function-- to provide effective equipment at a reasonable
cost.
• The manager responsible for maintenance activities should report to as
high a level of authority as is feasible to reduce the conflict between
production and maintenance.
• Maintenance stores and stores control should be the direct
responsibility of the manager responsible for the maintenance
activities.
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Internal Administrative Structure of the
Maintenance Department
The maintenance department can be structured in one of the following
ways:
– By trades ( mechanical, electrical, etc)
– By types of service (inspection, repairs, lubrications, etc.)
– By areas of equipment
– By maintenance policy type (emergency, preventive, predictive)
The internal organization structure is often a mixture of the above
types.
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Maintenance Organization in a
Small firm
Maintenance Organization in a
Medium-sized firm
Maintenance Supervisor
Mechanical
Maintenance Manager
Electrical
Stores
Repairs and
Installations
Preventive Repairs
Maintenance
Examples of
Administrative
Structures
Planning
Preventive
Maintenance
Zoned
Reactive
PM/PdM
Installations
Maintenance Maintenance and Overhauls Assignments
Boiler Room
Machine Shop
Inspections
Lubrications
Adjustments
Building
Trades
Mechanical
Electrical
Instrumentation &
Control
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Maintenance Manager
Planning, control & Training
Stores
Electrical
Supervisor
Reactive Inspection
(Emergency
Repairs)
Instrumentation &
Control Supervisor
Mechanical
Supervisor
Power PM/PdM
House Maintenance
Building
Supervisor
Zoned
Inspection
Assignments
Buildings Painting
Reactive Lubrication
(Emergency
Repairs)
Carpentry
PM/PdM
Maintenance
Maintenance Organization in a Large Firm
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M & R Implementation Process
1. Establish a M & R Assessment Team
2. Conduct a M & R Meeting
3. Conduct M & R Assessment and Benchmarking
4. Maintenance and Reliability Program Planning
5. Top Management Commitment
6. Pilot Program
7. Full Implementation
8. Continuous Improvement
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Maintenance Optimization
Establish
Vision
Operations
& Maintenance
Assessment
and Benchmarking
Analysis of Improvement
Opportunities
Technology
Fulfillment
Develop and
Track Key
Performance
Metrics
Process
Optimization
Resource
Optimization
Organizational
Alignment
Pilot Program
Continuous Improvement
Full Implementation
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M & R Implementation Process
1. Establish an M & R Assessment Team
– Members representing site activities such as maintenance,
production and support functions
– May include experts outside the organization
– Assess the current status of programs
2. Conduct a M & R Meeting
– Defines the scope, mission,vision, processes and evaluation criteria
– Creates a common vision between operations, maintenance and
management.
– Examines general information (facility organizational structure,
financial data, etc)
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M & R Implementation Process
Conduct a M & R Meeting (cont.)
– Identifies issues
– Develops a target interview list to conduct interviews with plant
personnel, including supplemental interviews with central
engineering and contractors. The interviews highlight the
effectiveness of the existing maintenance program, existing
technology, existing organizational structure and management
support.
– Reviews maintenance records on-site
– Researches technical information
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Data
collection
Identify
issues
Diagnosis and
synthesis
Conduct
benchmarking
Develop
findings
and
conclusions
Recommendation
development
Create
Develop
implementation
recommendations plans
Change
Implementation
Improved longterm effectiveness
of M&R
processes
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M & R Implementation Process
3. Conduct M & R Assessment and Benchmarking
– Analysis of strengths, weaknesses and opportunities within the
existing organization. Some of the elements of the analysis are:
• Plant equipment survey
• Existing Preventive/Predictive Program Review
• Technology Fulfillment
• Resource Optimization and Organizational Alignment
• Benchmarking ( gathers key performance indicators from
other industries and other companies within your industry.
E.g. production costs, maintenance labor costs per unit,
storeroom costs per employee, production unit downtime
percentage, etc.)
• Process optimization (work flow analysis)
• Need for and use of the CMMS within the facility
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M & R Implementation Process
Conduct M & R Assessment and Benchmarking (cont.)
– Develops findings and conclusions
• Assign ownership to address process improvement opportunity or
issue
• Consolidate and clarify issues and best practices
• Detail process improvement opportunities, support, and desired future
states
• Develop process improvement teams and identify other initiatives
with which to coordinate
– Develop recommendations
Based on the process improvement opportunities:
• Finalize future states
• Detail recommendations
• Estimate benefits and savings
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M & R Implementation Process
Conduct M & R Assessment and Benchmarking (cont.)
• Identify risks and constraints
• Identify prerequisites and associated costs
• Develop preliminary implementation steps
– Test improvement opportunities with workers, management, etc.
4. Create M & R Improvement Plans
– Estimate the payback period of each recommendation
– Detail overall implementation process and structure
– Develop preliminary implementation schedule
5. Secure top management buy-in
6. Pilot Program
– Prudent to start with a small effort and expand over time
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M & R Implementation Process
7. Full Implementation
– System-wide implementation
8. Continuous Improvement
– M&R optimization must be treated as a dynamic, continuous improvement
process.
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Current Activity
Equipment Failures
Prevented failures
Maintenance Problem
Types Found
Contracted
Services
PM Task
Effectiveness
Tools and
Instrumentation Program
Personnel and
Training
Maintenance Related
Improvements
Customer Feedback
(Internal & External
Current Activity
Program description, resources assigned,shops and laboratories, Preventive
Maintenance program, PdM program, functional organizational,
administrative process description, budget and other financial resources
Unpredicted failures, prevented failures, availability factors
Problems and types identified by PdM program, problems and types identified
by production, problems and types identified by contracted services
Description of services contracted out, contract relationships and how
administered, quality assurance of contracted services
Establish system selection criteria, identify PM’s not applicable or not
effective, identify PM’s with inadequate periodicity, identify overhaul PM’s to
replace with condition directed task, identify candidate PM’s for upgrade
Description of tool/instrumentation maintenance & calibration, redundancy
assessment, tools adequacy and condition (the right tool for the job), PdM
instrumentation accuracy maintenance
Personnel assigned to administered programs; PdM personnel experience &
training; maintenance worker job skills training; maintenance training
provided production/ operations staff
Description of locally made improvements; stimulus for identifying and
following through in improvements, root cause analysis, made or scheduled;
PdM results analysis; administration of continuous improvement program
Maintenance self-appraisal; production appraisal of maintenance; management
appraisal of maintenance; external customer feedback; maintenance workers’
appraisal of PdM team
Routine maintenance cost-effectiveness indicators; PdM program cost45savings;
overall company maintenance cost effectiveness
Good Communication is Essential!
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