accenture energy apas core maintainingrefineryasset

7/27/2019 Accenture Energy APAS Core MaintainingRefineryAsset

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Maintaining Refinery Assetsfor High Performance

An Accenture point of view for the downstream refinery sector

Accenture Plant andAutomation Solutions



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Across the downstreamrefinery sector, Accenture seestwo main factors affectingproduction and overalloperations performance.First, day-to-day costs formaintaining assets in apetroleum refinery continueto rise. The challenge forexecutives is to reducemaintenance costs and sustainthose cost reductions in aneffort to improve razor-thin profit margins without

jeopardizing futureproduction plans.

Second, many refineriesoperate with originallyinstalled equipment datingback two or more decades.While some componentshave been updated, theheavy use of aging assets

has brought the issue of asset reliability to the fore.This urgency is due notonly to production loss andincreased operating expenses,but also to the potential toadversely affect the healthand safety of employeesand local communities (andthereby damage a company’sreputation) in the event of anasset failure.

Accenture has identified

three leading practicesfor maintaining assets forreliability and, ultimately, highperformance:• Develop equipment-specificstrategies to focus oneffectively addressing failuremodes.• Improve maintenanceefficiency to ensure all work

(whether proactive or reactive)is executed effectively.• Enhance support effortsto better enable, accelerateand sustain equipment-specific strategies andmaintenance efficiency.

Rising maintenance costs and agingassets hamper quality production



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Each refinery likely will have a differentstarting point on its journey to improving assetmaintenance and reliability. For example, somefacilities may require full improvement initiatives,while others may require only a re-evaluation of existing operational strategies, or a reinforcementof the processes necessary for the sustainability of performance improvements (see Figure 1).

Stage 2

Maintenance improvement

activities under way

What steps can a refiner

take at this stage?

• Evaluate supply chain

support to reduce working

capital and further improve

productivity.• Implement a program to

manage deployment of

improvements across

facilities.

Stage 3

A focus on continuous

improvement


take at this stage?

• Investigate optimal systems

and technology

enhancements to better

enable the continuous

improvement program and

drive for root-cause

problem solving.

• Ensure full life-cycle

approach to asset

performance by integratingcapital-replenishment

and supply chain

considerations with

refining strategies based on

obtained performance.

Stage 1

Maintenance improvement

initiatives required


take at this stage?

• Develop equipment-specific

strategies to improve

efficiency of planned work.

• Implement an analysis of

root causes to solve

repetitive problems.

• Begin to monitor

performance and develop a

proactive culture.

Figure 1. The journey to maintenance excellence.



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Leading practice No.1:Develop equipment-specific strategies

The primary objective of developingequipment-specific strategies is toimprove the reliability of each asset

over its life cycle. These strategies canhelp maximize an asset’s cost-benefitratio as defined by routine “proactive”maintenance plans. Before developingequipment-specific strategies,Accenture recommends considering:• What are the critical assets of your

refinery?• Based on risk, how do different

activities reduce the probability of failure for each asset?• How are the strategies for specific

pieces of equipment leveraged and

applied to other assets?

Each refinery’s processing unithas its own compressors, pumps,exchangers, tanks, piping network,instrumentation and valves. Theseare all necessary for production.But can engineers pinpoint whichfactors cause each asset to failand determine the impact of thesefailures? What actions, if any, should

be taken to mitigate the causesof failure? Maintenance strategies

are most effective when refinersunderstand equipment failure modesand the benefits that may be realizedthrough alternative mitigation measures.

Accenture believes that developingequipment-specific strategies isthe first step in achieving leadingpractices for refiners. Once acomplete understanding of assetcriticality is developed, a risk-basedanalysis of failure modes and theireffects is used to define the righttasks and actions to implement perasset and failure mode. This processcan help engineers understand whathappens if they continue with currentmaintenance plans or apply differentstrategies. For example, would astrategy such as vibration monitoringbetter mitigate an asset’s failure?

An analysis of each asset can helpfacility managers identify the mostappropriate techniques for predictive

maintenance and operator carepractices. In some cases, developingan equipment-specific strategymay reveal that repeat failure iscaused by a misapplication of anasset and a redesign is required to“refit” a machine for its “purpose.” Inaddition, operating and maintenanceprocedures may require adjustment to

further address the causes of failure.

Regarding maintenance costexpenditures, the rank order of assetsand equipment failure rates can helpsenior management understand therelationship between cost and anasset’s criticality. For example, if anasset is not available, how well canthe refinery produce? What is the

impact on production, safety andthe environment with a functionalfailure? Based on the risk analysis,

management can better understandinvesting in mitigation measures.This analysis supports a life-cyclemanagement approach toasset performance.

Analyzing critical assets from A to Zmay seem like a comprehensive plan,but that type of step-process requiresa lot of time, cost and labor. In themeantime, asset failures continue andmaintenance costs keep rising.

Accenture recommends approachingequipment-specific strategies withoutmaking them major undertakings.Where possible, leverage developed

strategies across asset classesand focus on critical assets first.For example, take the bulk of thedefined work (i.e., the understandingof each asset’s failure modes) andleverage that information acrosssimilar equipment in all areas andprocess units. While one centrifugal

compressor may act uniquely in adifferent production environment,failure modes typically are similarfrom one process unit to the next;some are simply more prevalent inone process environment than inothers.

To help refiners achieve the lowestpossible cost for repairs and activitiesin proactive and reactive work,Accenture recommends applying

Lean Six Sigma principles. This groupof methodologies is widely used indiverse manufacturing industriesbecause it addresses processefficiency and quality. Many facetsof Lean Six Sigma should be appliedthroughout a refiner’s organization,beginning with improvements in theplanning and execution of the work.

Leading practice No. 2:Improve maintenanceefficiency

Lean Six Sigma is an importantmethodology to help drive operationalexcellence in a company. Accenturedefines operational excellence asthe integration of a set of strategieswith excellence in execution so that

new sources of growth, optimizedprocesses and balanced costs aredelivered with minimal complexity,maximum speed and effective changemanagement. The Accenture High

Performance Business researchinitiative has found that the pursuitof high performance—includingoperational excellence—is not only aworthy enterprise, but practicaland necessary.

A refiner’s objective is to increasethe “wrench time” percentage of itscraft personnel (i.e., the actual timecraft personnel are at work, usingtools, in front of jobs), completingmore work with the same resourcesby eliminating waste and non-value-added activities. Based onour experience, we have seenimprovements in craft utilization andwrench time translate to an increasein craft capacity. Examples of wasteor inefficiencies can include:

• Excessive motion to find parts,materials or information about a job.• Disorganized work environments.• Poor communication of needs,timing and scope for the work.

The ability to increase workerefficiency and productivity comesby enhancing the planning andscheduling process—not only forthe internal workforce, but alsofor contractors who augment the



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staff. If a refiner can determine thecorrect timing (when nonemergencywork should be completed toavoid unacceptable risk), then themaintenance department can be givenenough time to plan and organizethe work in order of priority. Thisprioritized scheduling can help reducethe costs associated with the repair—

for example, by avoiding overtime,expediting material/equipment supplyand reducing the need for additionalcontractor resources.

Leading practice No. 3:Enhance support efforts

Asset maintenance and reliabilitycannot be improved in a vacuum.Enhancing support efforts is critical

once transformational activitiesare under way. “Support” refersto anything required (but outsidethe core maintenance function) toexecute the processes previouslydescribed. The procurement,warehousing and supply of materials,parts and services is of primaryimportance in this area. The effectivemanagement of the supply chainefforts can be an advantage forrefiners. For example:• Improving the reliability of materials

supply can contribute to lowerongoing maintenance costs.• Materials can be stored onsite orpurchased as needed—whichever ismore cost effective.• Packaged materials can bewarehoused and “staged” forscheduled, cost-effective deliveries.In addition to the use of hard-good

materials, the use of contractorservices is an important partof support efforts. Based onour experience, a refiner’s bestopportunity for efficiency is tointegrate contractors seamlesslyinto an overall maintenance effort.Regardless of the company logo ontheir work uniforms, in-house experts

and contractors should function asone workforce.Often, refiners assign personnel toa job, but their plans lack sufficientdetail. To specify the full extent of a resource’s activity sequence, theexact resources (e.g., electricians,pipe fitters, etc.) and where they arecoming from (internal or externaltalent) need to be determined.Without predefined work plans,

we have seen many companiesend up planning as they go along.

This approach takes longer andis inefficient. When contractors

participate in inefficiently plannedprojects, their services can end upcosting more due to the terms andconditions of their contracts.



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Sustain improvements to assetmaintenance

In our experience, we have

seen some refiners approachimprovements to assetmaintenance and reliability, butthen lose focus or get boggeddown with the other time-consuming efforts that do notproduce early wins.

The value of improvementinitiatives can get sapped if management does not governthe new processes and leading

practices:

• Efficiency and cost gains can

be lost over time if there is alack of adherence to the newmethodology.• A lack of knowledge transfercan hamper implementationefforts if external resourcesare added.• Insufficient development of skills can create a scenarioin which the organizationcannot replicate the efforts andgains made during the initial

improvement period.



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To allow for a refiner's assetimprovement program to be sustainable,Accenture recommends refineries:

Institute a governance andperformance review processIn reality, this is the make-or-breakelement that determines whether anorganization will be successful andsustain its improvements. A goodgovernance process includes:• Requirements for the leadership in

directing and supporting the ongoingeffort.• A structure of defined roles,

responsibilities and accountabilitiesacross the organization that givesclarity on process details andrequirements, resulting in enhanceddecision-making.• A process for managing the

performance of each facility’smaintenance effort and everyoneinvolved in it, from the corporatelevel to the shop floor. This includesthe continuous improvement aspectof taking necessary actions to furtherenhance performance in light of theinformation being monitored.

With an effective governance

structure in place, refiners cancontinuously monitor and act uponresults, long after the spotlight is no

longer shining on the effort.

Manage change efforts andcommunicationsAs refiners start the journey toimplement the leading practicesdescribed here, managing thechange effort and the necessarycommunications is essential to garnerbroad acceptance and support forthe change that is taking place. Forexample, within one organization

there can be myriad culturalbackgrounds, skills and requirements.It is critical to engage personnel earlyand often so they can understandthe changes and what they meanto them. By keeping the lines of communication open, managementcan keep employees involved andfoster acceptance of the program.

Keeping senior management awareand supportive of the achieved gains

can help assure competing initiativesand strategies do not derail theeffort before this new way of doingthings becomes institutionalized.Without information, stakeholders

can lose focus on your initiatives and

reallocate funding elsewhere.

Build skills and capabilities Changing the guidelines of whatis expected and required is a maincause of stress for employees, if theyare not given the right skills andcapabilities to do their jobs withinthese guidelines. In any changemanagement effort, it is essentialto have a formal training approachto align the right skills with theright role and enhance individualprofessional development.

Managing talent resources anddeveloping individual capabilities doesnot only refer to technical issues,(such as how to repair a compressor);it is equally applicable to managerialand organizational improvementareas (e.g., how a program shouldbe led, what are the organizationalaspects for planning and how problemsolving assists root-cause analysis andcontinuous improvement.) Buildingindividual skills and capabilitiesimproves the success potential for

employees, which benefits thebroader organization.

Make effective use of toolsand technology to best enablethe improvements IT tools and systems make theperformance information of an assetmore readily available to personnel,which allows for more timelycorrective actions. By incorporatingdata and information from ongoing

activities and analyses, refiners canbetter accelerate the maintenanceand reliability improvements withinan organization.

Accenture has collaborated withstrategic vendors and developedan integrated predictive analyticsproduct. This solution provides moretimely information on an asset’scondition while providing a seamlessdashboard of all pertinent information

(including commercial) with whichto make better decisions on whereto focus corrective and improvementactions. With leaner organizations

and the ever-increasing pressuresto reduce costs while enhancingproduction, this product provides theclarity and speed of information tomeet these challenges and ensure

continued improvement. Moreover,this is an area of improvement thatcan benefit refiners who are earlyin the maturity of their reliabilityperformance as well as those lookingto distance themselves from

the competition.

In Accenture’s view,leading practices aresuccessful only if theyare sustainable. Theongoing maintenanceand reliableperformance of assetscan help your refineryon its journey to highperformance.



Copyright © 2010 Accenture

All rights reserved.

Accenture, its logo, and

High Performance Delivered are trademarks of Accenture.

About the author

Patrick Scullin, senior director—Manage-ment Consulting & Integrated Markets,Process & Innovation Performance

Mr. Scullin has more than 25 years of experience working with chemicals, energy,utility, forest products, metals and min-ing companies. As part of Accenture’s

Process & Innovation Performance serviceline, he is particularly focused on plantsand asset management and helps clientsconceptualize, design and implement pro-cess improvements. In addition to earningan MBA from the University of Houston

and bachelor’s degree in mechanicalengineering from the University of Texas,Mr. Scullin is a Certified Maintenance &Reliability Professional. Mr. Scullin can bereached at [email protected].

Contact us

To learn more about how Accenture canhelp your energy company on its journey tohigh performance, visit us at www.accen-ture.com or call us at +1 312 737 7909, ortoll-free in the United States and Canada at+1 888 688 7909.

To learn more about the Accenture Energy

industry group, visit www.accenture.com/energy.

To learn more about Lean Six Sigma and theProcess & Innovation Performance serviceline, visitwww.accenture.com/Global/Consulting/Process_and_Innovation_Performance/default.htm.

About Accenture

Accenture is a global managementconsulting, technology services

and outsourcing company, withmore than 181,000 people servingclients in more than 120 countries.Combining unparalleled experience,comprehensive capabilities acrossall industries and business functions,and extensive research on the world’smost successful companies, Accenturecollaborates with clients to help thembecome high-performance businessesand governments. The companygenerated net revenues of US$21.58billion for the fiscal year ended

Aug. 31, 2009. Its home page iswww.accenture.com.

About Accenture Plant andAutomation Solutions

Accenture Plant and AutomationSolutions is a suite of offeringsdesigned for asset-intensivecompanies across industries such asmetals and mining, chemical, pulpand paper, oil and gas, and utilities.Our offering comprises solutionsfor engineering, project and datamanagement; core plant operations;environment, health and safety;enabling services; and, industrial andautomation capabilities. We combine

our extensive industry experience

with our innovative, vendor-neutralsolutions to help you build andoperate plants and assets in a reliable,safe and cost-effective manner.

accenture energy apas core maintainingrefineryasset

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