“Processes Shielding”

Manufacturing Engineers teamIuri Gribel

Sergio Boiko

Ricardo Militerno

Thais Franco

CASE STUDYEnergy Turbogenerator Plant

BRAZIL

ENERGY DIVISION - NEW EQUIPMENTS

Separeted from Rolls-Royce Motors cars since 1971

WHAT WE ARE NOT

ROLLS-ROYCE - FOUR BUSINESS SECTORS

Civil Aviation

Marine

Defense Aviation

Off Shore Energy

All Utilizing common technology across sectors

A

FÁBRICA

SANTA CRUZ PLANT

• The factory of Rolls-Royce located in Santa Cruz - Rio de Janeiro was the

first factory in South America designed to assemble and test turbo power

generators for the pre-salt. Contracted by Petrobras for power generation ineight oil rigs to support TUPI project.

• Land area - 103,000 square meter

• Initial investment - USD100M

• 114 total employees (direct employment and third party)

• Capacity Implemented for assembly and test;

10 to 14 RB211 packages per year

operating in one shift.

full capacity utilization – 40%

Artistic vision of Santa Cruz Plant

Factory office: production, purchasing, PCP,

materials, foreign trade, service, financial,

quality and SMS

Assembly Test

Test HallLoading Bank

Utilities

CUSTOMER VOICE

CUSTOMER EXPECTATIONS

• HSE in full

• On Time Delivery

• Delivery Quality as contracted

• Tests on time and in accordance - Customer witness &

certified by external body

• Agile supply chain – quick recovery

• Achieve local content target

How To align expectations between client and company?

The Organizational

Culture

IMPERATIVES OF ROLLS-ROYCE STRATEGY

Mission :

Deliver products and services

industry leaders

Delivering to customers what

they expect

As a result, generate a profitable and

growing contribution to the company and

stakeholders

Achieving business excellence

Positioning the business to grow

Vision:

Be the first choice of

customers in solutions

for power distribution

and compression

systems.

.

People engaged and winning together

ROLLS-ROYCE MISSION AND VISION

OPERATIONAL EXCELENCE - PLANT STRATEGY

• Safety always come first

• Customers define value

• It is our responsibility to create value

• People - respect, challenge, training and develop

• Standardize - always

• We built our quality internally based on:

1. Decision based on facts & data, having long term perspective

2. Consider all available options and risks

3. When problems arise, we fix it immediately. Never a known error is

tolerated or repeated

4. Value do right first time

5. Develop a culture focused on make things happen

PLANT VALUES AND BELIEFS

Values– Integrity, reliability and innovation

Boosters– Dynamic, high-performance focusing on results

Beliefs:

• Build confidence through trust-based relationships

• Develop people in order to develop business

• The greater our vision, the bigger our success chances

• To achieve goals having great professionals working & winning together

• Put Passion in what you do

• Well-prepared professionals produces excellent results

Plant Vision: To delivery operational excellence in project execution, low

cost, right quality and on-time delivery

CULTURE IMPLEMENTATION

How to align culture elements with delivering results in an OPEX

environment?

• Raise awareness by training;

• Walk the talk to develop trust & respect;

• Map competence and skills out – Bridge it by

closing gaps;

• Train leadership in lead by example;

• Celebrate results;

• Communicate with transparency & frequently

PLANT PRINCIPLES LETTER

HSE – Safety comes first

Delivery – meet customer expectation

Quality – do right first time

Costs – do more with less

Continous Improvement - always

People – committment & engagement

Work Environment – nice place to work

THE PEOPLE

THE PEOPLE

SKILLS AND ABILITIES CONSTRUCTION

People in the right place!

Empowerment

Evaluation and selection center

Personal Development

LeadershipCommitment

SENAI Technical Training

SEARCH EMPLOYEES/ TALENTS

• People with sufficient level of competence to the business;

• Good balance of cost;

• Mixed team of young and experienced;

• Psychological profile and leadership aligned with the

business.

All engaged in the challenge of being part of the setup of the first

Brazilian plant power turbo generators.

vcan

TECHNOLOGY TRANSFER

HSE

Manufacturing

Engineering

Quality

Planning

Logistics

Foreign Trade

Purchasing

Finance

Operational Training

Management Training

Know How Transfer

THE PRODUCTION PROCESS

FEATURES OF THE PRODUCTION PROCESS

• Each project is a unique product

• Long production cycle

• Assembly and test labor-intensive process

• Sequence of activities with little repetition

• High raw materials costs

• Many number of components and high dependence on the material flow

• High dependency in planning and control

ENERGY BUSINESS PRODUCT

Turbine - RB211 – 32MW

• The generation package is powered by a RB211 turbine. Package is assembled and

tested in Santa Cruz plant to meet the FPSO pre-salt platforms (floating production,

storage & offloading vessels) - TUPI project requirements.

• Four RB211 packages provides energy to gear one FPSO

Divisão Energia - Novos equipamentos

TURBOGENERATOR PACKAGE RB211

1

2

3

4 56

7

8

9

1- Air in Taken

2- Gas Generator Turbine

3- Base Plate

4- Combustion Chamber

5- Power Generator Turbine

6- Gear Box (reduces rotation)

7- Generator

8- Cooling System

9- Exhaust Chamber/Ducts

PHILOSOPHY OF INDUSTRIAL MANAGEMENT

Divisão Energia - Novos equipamentos

Rolls-Royce Quality Management System

Leadership

Process Basics

Process Control

Journey to Process Excellence

Co

nti

nu

ou

s Im

pro

vem

en

tS

tan

dard

isati

on

Capable Empowered People

LEAN SIX SIGMA

Pro

ce

ss

Flo

w

Pro

ce

ss C

ap

ab

ilit

y

Ro

lls-R

oyc

e P

rod

uc

tio

n S

ys

tem

Rolls – Royce Production system – Integrated Management System

ISO 9001 + ISO 14001 + OSHAS 18001

Lean manufacturing + Six Sigma

OPERATIONAL EXCELENCE

ESTRATIFICAÇÃO DA ESTRATÉGIAPolicy Deployment

Level 1 Executive

Level 2 Intermediate

Level 3

Operational

•HSE (LTIFR, TRIR)

•Cost of Non Quality

•Customer Master Production Schedule (MPS)

•Standard hour cost

•HSE Programs /Number of non-compliant

•Cycle Time / Productivity

•Timeout load release (air / sea)

•Utilities Costs

•Safety Daily dialogue / Near miss

•Capture problems (WHO);

•Communication Cell

•Overtime and Turnover

Results

Execution

TOP

DOWN

BOTTOM

UP

ESTRATEGY POLICY DEPLOYMENT

RESULTS

OPERATIONAL LEVEL KPIS

Communication Cell

Logistics Board Materials Board

Overtime Turnover

2

3 4 4

62 60 60

5753

48 44

3%

8%

15%

21%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

05

10152025303540455055606570

AP01 AP02 AP03 AP04 AP05 AP06 AP07 AP08 AP09 AP10 AP11 AP12

TURNOVER

# Dismissal # Employees (budget)

# Employees (actual) % Turnover (Cumulated)

OVERTIME

0,12

0,62

2,50

0,94

0,26

1,54

3,56

1,51

0,71

1,31

5,00

0,00

2,00

4,00

6,00

8,00

10,00

% Overtime 2015

%

Meta

INTERMEDIARY MANAGEMENT

Utilization Inventory Productivity

Foreign Trade Utilities

Divisão Energia - Novos equipamentos

5%

43%49%

75%

58%

40%

24%

77%

100% 101%

89%

43%

84%

98% 96%

117%

103% 103%95%

100%96%

109%105%

33%

0%

20%

40%

60%

80%

100%

120%

140%

Monthly Actual Cumulative Forecast Cumulative Actual

UTILIZATION

Foreign Trade

Total Time – Cargo Arrival in Brazil vs Load

Air – 2014 - 2015

Divisão Energia - Novos equipamentos

Divisão Energia - Novos equipamentos

PRODUCTIVITY

41

0

20

40

60

80

100

120

Mar Apr May Jun Jul Aug Sep Out

Hora

s

Retrabalho

Retrabalho

EXECUTIVE MANAGEMENT

HSE (LTIFR, TRIR)

Cost of Non Quality

Customer Delivery Program (MPS)

Hourly Standard

CUSTOMER DELIVERY PROGRAM

PERFORMANCE BOARD SANTA CRUZ

PROCESSES SHIELDING

VISUAL MANAGEMENT

BEFORE AFTER

ASSEMBLY HALL

TEST HALL

FINAL RESULTS - SAFETY

862

31/12/2015

FINAL RESULTS – LEARNING CURVE

Learning Curve

Start Up Construction Completion

Ramp up & learning curve

Steady state

Aug to Dec

2013

Jan to Mar

2014

May

2014

Apr to Sept

2014

Oct

2014Ongoing

2015

Learning curve achieved in the third mounted driver or in three months time

Supplier Payments

Commercial

Invoice approval

AWB Approval

K&N Management

Export

consolidation

Custom backlog

Blue Line Approval

Broker

requirements

FSC Management

Unverified Invoices

NF Approval

GR Backlog

Picks Parts against

TO

Sizing sort string

align to build

Confirm TO

Indirect

Scope

Storage space

CEVA Management

Supply

Management

Shipping Management

Customs Management

Goods ReceiptGoods

Issue/TOMaterial Handling

Inventory Impact

Supplier Payments

Scheduling/

Incoming Inventory

MTV consolidation

C Class solution

Focus List

Ale

xA

leandro

Alm

ir

Priority list update

Daart Board

updates

Supplier contracts

renegotiation

Control software

for importation

SUPPLY CHAIN MAPPING - BEFORE

Supplier Payments

Commercial

invoice approval

AWB Approval

K&N Performance Export

consolidation

Customs Backlog

Blue Line Approval

Broker

Requirements

FSC

Performance

Unverified Invoices

NF Approval

GR Lead time

Picks Parts against

TO

Sizing sort string

align to build

Confirm TO

Indirect

Scope

Storage space

CEVA Management

Supply

Management

Shipping Management

Customs Management

Goods ReceiptGoods

Issue/TOMaterial Handling

Delivery to Customer

Major Buys

Payments

Supply & Demand

Alignment

RRESI

Shipments

C-Class Solution Focus List

Ale

andro

(Lo

gis

tics)

Ale

andro

(Pla

nn

ing

)A

lmir

Priority list update

Supplier Contracts

Renegotiation

Control Software

for importation

Prep to Ship Area

Inventory Accuracy

On Time Inbound

Delivery

Raw Materials

Inventory Value

C-Class Local

Supply

Suppliers Payments (no

major buys)

RRESI Sub-Assy

Consolidation

SUPPLY CHAIN FINAL RESULTS – AFTER

FINAL RESULTS - DELIVERY

Since the P69 that the delivery date promised to customer has being achieved – no rebase line

P68 P69 P70 P71 P72 P73

First FPSO

assembled and

tested in Santa

Cruz

FINAL RESULTS – LOCAL CONTENT

Meta Projetado

P-66 Unit 1 35.0% 49.3%.

P-66 Unit 2 35.0% 49.8%

P-66 Unit 3 35.0% 51.1%

P-66 Unit 4 35.0% 49.6%

P-67 All Units 37.0% 45.9%

P-68 All Units 39.0% 47.5%

P-69 All Units 41.0% 48.9%

P-70 All Units 43.5% 48.9%*

P-71 All Units 46.0% 48.9%*

P-72 All Units 48.5% 49.5%*

P-73 All Units 51.0% 70.0%*

CUSTOMER SATISFACTION

May, 2015

FINAL RESULTS – CUSTOMER SATISFACTION

NPS

SCORE

How likely would you be to

recommend Siemens

ADGT to others?

<i>0-6 = Detractor

(Unlikely to recommend

Siemens ADGT), 7-8 =

Passive, 9-10 = Promoter

(Likely to recommend

Siemens ADGT)</i>

How satisfied are

you with the

following? The

performance of

our employees in

supporting your

needs?

How satisfied are

you with the

following? Our

responses to

your questions or

queries?

How satisfied are

you with the

following? The

overall value of

our product or

service?

How satisfied are

you with the

following? The

delivery of your

Siemens ADGT

product or

service?

How satisfied are

you with the

following? The

quality of our

product or

service?

How satisfied are

you with the

following? The

reliability of our

product or

service?

8 9 8 8 7 7 9 8

9 10 8 8 9 7 8 8

9 10 9 9 9 9 9 9

8 9 9 8 9 8 9 9

10 10 10 10 10 9 10 10

9 10 9 9 9 8 8 8

10 10 10 10 9 10 9 9

FINAL RESULTS – COSTS REDUCTION

What ? How

Much?

Production Capacity Utilization + 40%

Productivity gains + 23%

LNG consumption - 10%

Electrical Power demand and consumption ( includes Price increase) - 16%

Electrical power consumtion ( usage only) - 30%

City water consumption - 50%

Storage costs at customs port or airport - 54%

Site overtime ( zero overtime in the admistration) - 72%

HOW WE CELEBRATE...

YELLOW BELT WINNERS 2014

SAFETY CHAMPIONSHIP

Monthly award for

the best of the

month

HOW DO WE COMUNICATE INTERNALLY…

In summary we delivered Customer Expectations set out when started off

• HSE in full - Delivered

• On Time Delivery – Recovered 180 days lost - Delivered

• Delivery Quality as contracted - Delivered

• Tests on time and in accordance - Customer witness &

certified by external body - Delivered

• Agile supply chain – quick recovery - Delivered

• Achieve local content target - Delivered

NPS

SCORE

8

9

9

8

10

9

10

•HSE (LTIFR, TRIR) – record of 862 days LTIFR

•Cost of Non Quality – below target in 20%

•Customer Master Production Schedule (MPS) –on time delivered – recovered 180 days delay

•Standard hour cost – 7,3% below target

In summary we delivered business expectations

as defined at initial stage

Level 1 Executive

Plant vision was: To delivery operational excellence in project

execution, low cost, right quality and on-time delivery

We pray as if everything depended

on God

We work as if everything depended

on us