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© 2009 Shire Systems Limited learnShop™ Lean maintenance Lean maintenance using using measures measures to boost performance to boost performance By Paul Dean, CEng Shire Systems Limited

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Page 1: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

learnShop™

Lean maintenance Lean maintenance using using measuresmeasures to boost performanceto boost performance

By Paul Dean, CEng

Shire Systems Limited

Page 2: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

This presentationThis presentation is not particularly about is not particularly about CMMS. After all, CMMS is just a tool, albeit a CMMS. After all, CMMS is just a tool, albeit a very important one very important one –– for itfor it’’s the means by which s the means by which maintenance professionals can secure success maintenance professionals can secure success for their equipmentfor their equipment--dependent organisations.dependent organisations.

When we talk about craftsmanship, we tend not When we talk about craftsmanship, we tend not to focus on the tools used to focus on the tools used –– we accept them as we accept them as a necessity. Our real interest lies in aspects of a a necessity. Our real interest lies in aspects of a craftsmancraftsman’’s knows know--how and skill.how and skill.

Accordingly, this presentation is principally about Accordingly, this presentation is principally about Maintenance Management and the role of the Maintenance Management and the role of the Engineering Manager Engineering Manager –– your roleyour role

Page 3: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

What will be coveredWhat will be covered

Lean times ahead Lean times ahead -- Lean and the recession Lean and the recession

Where you, as Engineering Manager, fit inWhere you, as Engineering Manager, fit in

Maintenance cause and effect Maintenance cause and effect –– the Costthe Cost--Value Value SyndromeSyndrome

Lean and TPMLean and TPM

BeforeBefore-- and afterand after--failure maintenance regimesfailure maintenance regimes

The lagging and leading indicators of maintenance The lagging and leading indicators of maintenance performanceperformance

The big hitter performance indicators and practicesThe big hitter performance indicators and practices

Managing using Managing using ‘‘measuresmeasures’’

Page 4: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

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© 2009 Shire Systems Limited

Lean times aheadLean times ahead

2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin

Page 6: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin

To survive the recession, you must To survive the recession, you must take market share from your take market share from your competitors. Therefore, if your competitors. Therefore, if your organisation has a performance organisation has a performance gap, you must close it gap, you must close it -- and quickly

The DODODidus ineptus

Don’t end up like me!

and quickly

Page 7: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

2009 will decidedly be the year of 2009 will decidedly be the year of survival of the fittest survival of the fittest -- very very appropriate in the 200th anniversary appropriate in the 200th anniversary year of the birth of Charles Darwinyear of the birth of Charles Darwin

To survive the recession, you must To survive the recession, you must take market share from your take market share from your competitors. Therefore, if your competitors. Therefore, if your organisation has a performance organisation has a performance gap, you must close it gap, you must close it -- and quicklyand quickly

The manufacturers left standing will The manufacturers left standing will probably be the ones that have probably be the ones that have embraced embraced Lean

The DODODidus ineptus

Don’t end up like me!

Lean

Page 8: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

Daniel Jones, the UK High Priest of Lean, observes:Daniel Jones, the UK High Priest of Lean, observes:

A recession is a good time for A recession is a good time for Lean. Organisations can either Lean. Organisations can either postpone Lean and resort to postpone Lean and resort to traditional cost cutting, or they traditional cost cutting, or they can accelerate and redouble can accelerate and redouble their progress with Lean. I doubt their progress with Lean. I doubt the former will last the course. the former will last the course. But the latter stand a good But the latter stand a good chance of surviving and laying chance of surviving and laying the foundations for future the foundations for future prosperity as they turn the tables prosperity as they turn the tables on their competitorson their competitors……

Lean Enterprise Academy newsletter, November, 2008

www.leanuk.org

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© 2009 Shire Systems Limited

Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind

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© 2009 Shire Systems Limited

Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind

You are a maintenance professional. You are a maintenance professional. Above all, you are a Above all, you are a leader. leader. You must You must also be an also be an innovatorinnovator. You are closest . You are closest to the action and itto the action and it’’s you that must drive s you that must drive maintenance change maintenance change -- if not you,if not you, whowho??

Page 11: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times aheadLean manufacturing initiatives are Lean manufacturing initiatives are driven from the top. But they depend on driven from the top. But they depend on maintenance transformation maintenance transformation –– and and thatthat’’s s youryour baby! You are the baby! You are the controlling mindcontrolling mind

You are a maintenance professional. You are a maintenance professional. Above all, you are a Above all, you are a leader. leader. You must You must also be an also be an innovatorinnovator. You are closest . You are closest to the action and itto the action and it’’s you that must drive s you that must drive maintenance change maintenance change -- if not you,if not you, whowho??

Ask yourself the question: Ask yourself the question: Am I a Am I a true leadertrue leader--innovator or a repair innovator or a repair administrator? administrator?

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© 2009 Shire Systems Limited

You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate the need to innovate

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© 2009 Shire Systems Limited

You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate. the need to innovate.

As an Engineering Manager, you hold As an Engineering Manager, you hold the key to increased manufacturing the key to increased manufacturing performance performance –– so ask yourself a so ask yourself a second question second question How fast am I How fast am I making things better?making things better?

Page 14: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

You are You are keykeyNever in your lifetime has there been Never in your lifetime has there been a greater need for you to do more a greater need for you to do more with less with less –– the need to innovate. the need to innovate.

As an Engineering Manager, you hold As an Engineering Manager, you hold the key to increased manufacturing the key to increased manufacturing performance performance –– so ask yourself a so ask yourself a second question second question How fast am I How fast am I making things better?making things better?Your organisationYour organisation’’s post recession s post recession survival depends on your answer to survival depends on your answer to these acid test questionsthese acid test questions

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© 2009 Shire Systems Limited

Consider two companies producing Consider two companies producing the same product the same product

One has healthy, reliable One has healthy, reliable equipmentequipment……

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© 2009 Shire Systems Limited

Consider two companies producing Consider two companies producing the same product the same product

…….the other has unhealthy, .the other has unhealthy, troublesome equipment troublesome equipment

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© 2009 Shire Systems Limited

Consider two companies producing Consider two companies producing the same product the same product

The company with the greater The company with the greater downtime faces the following downtime faces the following disadvantagesdisadvantages……

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© 2009 Shire Systems Limited

Disadvantages of unhealthy equipmentDisadvantages of unhealthy equipment

More defectsMore defects

More overtimeMore overtime

More material costsMore material costs

More overheadsMore overheads

More shipping delaysMore shipping delays

More standby plant More standby plant –– wasted capital wasted capital -- a bigger a bigger ‘‘hiddenhidden’’ factoryfactory

More health, safety and More health, safety and environmental violations and environmental violations and expenseexpense

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© 2009 Shire Systems Limited

Disadvantages of unhealthy equipmentDisadvantages of unhealthy equipment

Which one will survive the recession? Which one will survive the recession?

More defectsMore defects

More overtimeMore overtime

More material costsMore material costs

More overheadsMore overheads

More shipping delaysMore shipping delays

More standby plant More standby plant –– wasted capital wasted capital -- a bigger a bigger ‘‘hiddenhidden’’ factoryfactory

More health, safety and More health, safety and environmental violations and environmental violations and expenseexpense

Page 20: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture

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© 2009 Shire Systems Limited

Lean times aheadLean times ahead

Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture

However, However, lean manufacturing lean manufacturing assumes that sufficient assumes that sufficient machine Availability already machine Availability already exists in the first placeexists in the first place

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© 2009 Shire Systems Limited

Lean times aheadLean times ahead

I wish

Senior managers aspire to reap Senior managers aspire to reap the rewards of Lean the rewards of Lean manufacturemanufacture

However, However, lean manufacturing lean manufacturing assumes that sufficient assumes that sufficient machine Availability already machine Availability already exists in the first placeexists in the first place

Companies managing only 60 Companies managing only 60 or 70% Availability during or 70% Availability during scheduled uptime CANNOT be scheduled uptime CANNOT be LeanLean

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© 2009 Shire Systems Limited

Lean times aheadLean times ahead

Many manufacturers still operate Many manufacturers still operate without applying best practice in without applying best practice in maintenance management. Ipso maintenance management. Ipso facto, their facto, their achievable achievable manufacturing performance is manufacturing performance is totally compromisedtotally compromised

Page 24: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Lean times aheadLean times ahead

Many manufacturers still operate Many manufacturers still operate without applying best practice in without applying best practice in maintenance management. Ipso maintenance management. Ipso facto, their facto, their achievable achievable manufacturing performance is manufacturing performance is totally compromisedtotally compromised

Poor performance has its basis Poor performance has its basis in a reactive, inept approach to in a reactive, inept approach to maintenance maintenance –– the the absence of absence of planningplanning,, coupled withcoupled withequipment abuseequipment abuse

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost icebergThe costThe cost--value syndromevalue syndrome

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’

The Maintenance The Maintenance DepartmentDepartment’’s headcount and s headcount and expenses make up the tip of expenses make up the tip of the iceberg the iceberg –– the part seen the part seen by Management and by Management and onlookers

Maintenance

onlookers

Page 28: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Most will be familiar with the Most will be familiar with the concept of the concept of the ‘‘maintenance maintenance cost icebergcost iceberg’’

The Maintenance The Maintenance DepartmentDepartment’’s headcount and s headcount and expenses make up the tip of expenses make up the tip of the iceberg the iceberg –– the part seen the part seen by Management and by Management and onlookersonlookers

But the bulk of the costs lie But the bulk of the costs lie hidden beneath the surface hidden beneath the surface and present a huge danger and present a huge danger to unwary businessesto unwary businesses…

Maintenance

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Often too detached from Often too detached from the workplace, the workplace, Management can be Management can be infected with a pennyinfected with a penny--pinching, pinching, ‘‘beanbean--countingcounting’’mentality

Maintenance

mentality

How much of an iceberg is seen above water?

Page 30: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Often too detached from Often too detached from the workplace, the workplace, Management can be Management can be infected with a pennyinfected with a penny--pinching, pinching, ‘‘beanbean--countingcounting’’mentalitymentality

Too many are obsessed Too many are obsessed with cost cutting with cost cutting -- rather rather than with ensuring than with ensuring resources are properly resources are properly deployed to add valuedeployed to add value

I’ll nuke itWaste!

Maintenance

How much of an iceberg is seen above water?

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost

Page 32: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost

To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget

Page 33: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost

To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget

The value that maintenance adds to The value that maintenance adds to manufacture often gets ignored. But, manufacture often gets ignored. But, maintenancemaintenance’’s contribution to uptime s contribution to uptime and product quality is worth more than10 and product quality is worth more than10 times the potential for maintenance cost times the potential for maintenance cost reductions

Don’t!

reductions

Page 34: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Maintenance is indeed a large element Maintenance is indeed a large element of the cost of manufacture of the cost of manufacture -- the largest the largest controllable costcontrollable cost

To lessen the To lessen the ‘‘burdenburden’’, Management, Management’’s s traditional inclination has been to chop traditional inclination has been to chop the maintenance headcount and the maintenance headcount and squeeze the maintenance budget squeeze the maintenance budget

The value that maintenance adds to The value that maintenance adds to manufacture often gets ignored. But, manufacture often gets ignored. But, maintenancemaintenance’’s contribution to uptime s contribution to uptime and product quality is worth more than10 and product quality is worth more than10 times the potential for maintenance cost times the potential for maintenance cost reductionsreductions

The Cost-Value syndrome

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

How much of an iceberg is seen above water?

Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface

Page 36: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface

But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation

10

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© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

(Non) Machine Availability

(Non) Process Capability

(Non) Regulatory Compliance

(Inflated) Operating Costs

(Wasted) Capital

Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface

But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation

Page 38: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface

But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation

<10%

(Non) Machine Availability

(Non) Process Capability

(Non) Regulatory Compliance

(Inflated) Operating Costs

(Wasted) Capital

Page 39: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

Beyond the visible costs Beyond the visible costs of maintenance of maintenance –– the the headcount and expense headcount and expense budget budget –– the major costs the major costs actually experienced by actually experienced by the business are hidden the business are hidden beneath the surfacebeneath the surface

But theyBut they’’re there and re there and theythey’’re very real! The re very real! The Maintenance Department Maintenance Department does not exist in isolationdoes not exist in isolation

<10%The ‘hidden’

factory (Non) Machine Availability

(Non) Process Capability

(Non) Regulatory Compliance

(Inflated) Operating Costs

(Wasted) Capital

Page 40: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

WellWell--targeted, valuetargeted, value--adding cost reduction adding cost reduction --driven by you, the driven by you, the Engineering ManagerEngineering Manager–– can decrease the can decrease the overall mass of the overall mass of the maintenance cost maintenance cost icebergiceberg……

(Non) Machine Availability

(Non) Process Capability

(Non) Regulatory Compliance

(Inflated) Operating Costs

(Wasted) Capital

Page 41: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

WellWell--targeted, valuetargeted, value--adding cost reduction adding cost reduction --driven by you, the driven by you, the Engineering ManagerEngineering Manager–– can decrease the can decrease the overall mass of the overall mass of the maintenance cost maintenance cost icebergiceberg……

Cost cutting is very different from value-adding cost

saving

Page 42: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

The maintenance cost icebergThe maintenance cost iceberg

In the process, the In the process, the ‘‘visiblevisible’’ costs of costs of maintenance will reduce maintenance will reduce automatically automatically –– by half, by half, or more, in some or more, in some casescases.. But, this saving is But, this saving is secondary compared to secondary compared to the more than 10the more than 10--fold fold other gains realised in other gains realised in production, profit and production, profit and competitive advantage

Maintenance

competitive advantage

Page 43: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Beware!Beware! The iceberg gets biggerThe iceberg gets bigger

A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites

Page 44: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Beware!Beware! The iceberg gets biggerThe iceberg gets bigger

A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites

Gurus of Lean say that the downtime Gurus of Lean say that the downtime costs in a Leancosts in a Lean--configured configured manufacturing cell are 5 to 30 times manufacturing cell are 5 to 30 times more than in other manufacturing more than in other manufacturing environments environments -- because of the direct because of the direct and immediate losses kicking in and immediate losses kicking in along the manufacturing & supply along the manufacturing & supply chain chain

Page 45: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Beware!Beware! The iceberg gets biggerThe iceberg gets bigger

A big problem lurks for Lean hopefuls A big problem lurks for Lean hopefuls who donwho don’’t keep up with the t keep up with the maintenance prerequisitesmaintenance prerequisites

Gurus of Lean say that the downtime Gurus of Lean say that the downtime costs in a Leancosts in a Lean--configured configured manufacturing cell are 5 to 30 times manufacturing cell are 5 to 30 times more than in other manufacturing more than in other manufacturing environments environments -- because of the direct because of the direct and immediate losses kicking in and immediate losses kicking in along the manufacturing & supply along the manufacturing & supply chain chain

The maintenance cost iceberg can The maintenance cost iceberg can become even more menacing!become even more menacing!

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Failure repair and preventionFailure repair and preventionReactive and proactive maintenanceReactive and proactive maintenance

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© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Most maintenance is Most maintenance is carried out carried out after failureafter failure

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© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Most maintenance is Most maintenance is carried out carried out after failureafter failure

Disruptive functional failures - breakdownsaffecting production

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© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Most maintenance is Most maintenance is carried out carried out after failureafter failure

Traditionally, maintenance Traditionally, maintenance has been repairhas been repair--oriented. oriented. Break it, then fix it.Break it, then fix it.Reasonable enough in Reasonable enough in Victorian times Victorian times -- maybemaybe --but not now!but not now!

Page 50: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Most maintenance is Most maintenance is carried out carried out after failureafter failure

Traditionally, maintenance Traditionally, maintenance has been repairhas been repair--oriented. oriented. Break it, then fix it.Break it, then fix it.Reasonable enough in Reasonable enough in Victorian times Victorian times -- maybemaybe --but not now!but not now!

This has resulted in a This has resulted in a very harmful legacy very harmful legacy predisposition predisposition ––aversion to planningaversion to planning

5 to 10% of work planned

90 to 95% of work unplanned

Before failure After failure

failurefailureM

aint

enan

ce C

osts

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© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense

5 to 10% of work planned

90 to 95% of work unplanned

Before failure After failure

failurefailureM

aint

enan

ce C

osts

expense

Page 52: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense expense

Unplanned jobs Unplanned jobs routinely take 3 times routinely take 3 times longer than a planned longer than a planned job job -- and equipment and equipment uptime and capability uptime and capability is lost into the is lost into the bargain bargain –– another another 10X factor hit!10X factor hit!

5 to 10% of work planned

90 to 95% of work unplanned

Before failure After failure

failurefailureM

aint

enan

ce C

osts

Page 53: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Reactive maintenanceReactive maintenance

Repair jobs Repair jobs performed after performed after failure can failure can cost 10 cost 10 times moretimes more in terms in terms of maintenance of maintenance expense expense

Unplanned jobs Unplanned jobs routinely take 3 times routinely take 3 times longer than a planned longer than a planned job job -- and equipment and equipment uptime and capability uptime and capability is lost into the is lost into the bargain bargain –– another another 10X factor hit!10X factor hit!

5 to 10% of work planned

90 to 95% of work unplanned

Before failure After failure

failurefailureM

aint

enan

ce C

osts

The reason’s simple…

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© 2009 Shire Systems Limited

Throwing good money after badThrowing good money after badAfter a breakdown, the time to establish the facts and decide After a breakdown, the time to establish the facts and decide repair needs automatically increases due to:repair needs automatically increases due to:

Confusion Confusion

NonNon--availability of labour, materials, availability of labour, materials, equipment and technical information equipment and technical information

The possible need to search out and The possible need to search out and cannibalise other plant cannibalise other plant

When contractors and hired When contractors and hired equipment are needed, the time and equipment are needed, the time and money wastage escalates money wastage escalates

When failure is catastrophic, the When failure is catastrophic, the consequences of the collateral consequences of the collateral damage is anyonedamage is anyone’’s guess

Ouch!

s guess

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Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……

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Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……

From ‘‘So what?So what?’’ to…

‘‘What aWhat a catastrophe!catastrophe!’’

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Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……

Speed loss, quality loss, minor stops, yield loss

Partial Failure

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© 2009 Shire Systems Limited

Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……

Speed loss, quality loss, minor stops, yield loss

Partial Failure

Breakdown!Production stops

Total Failure

Page 59: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Gambling with failureGambling with failureThe escalation of The escalation of damagedamage……

Speed loss, quality loss, minor stops, yield loss

More expensive to fix Breakdown

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

Page 60: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Gambling with failureGambling with failure

Speed loss, quality loss, minor stops, yield loss

More expensive to fix Breakdown

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

Total Failurewith

catastrophic damage

Page 61: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Gambling with failureGambling with failure

More expensive to fix Breakdown

Speed loss, quality loss, minor stops, yield loss

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

The sky is the The sky is the limit for loss!limit for loss!

Total Failurewith

catastrophic damage

Page 62: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Gambling with failureGambling with failure

More expensive to fix Breakdown

Speed loss, quality loss, minor stops, yield loss

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

The sky is the The sky is the limit for loss!limit for loss!

Total Failurewith

catastrophic damage

The Engineering Manager is mainly responsible for these avoidable failures

Page 63: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Gambling with failureGambling with failure

More expensive to fix Breakdown

Speed loss, quality loss, minor stops, yield loss

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

The sky is the The sky is the limit for loss!limit for loss!

Total Failurewith

catastrophic damage

Senior management is responsible for these avoidable calamities

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© 2009 Shire Systems Limited

Gambling with failureGambling with failure

Speed loss, quality loss, minor stops, yield loss

More expensive to fix Breakdown

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

The sky is the The sky is the limit for loss!limit for loss!

Total Failurewith

catastrophic damageBasically a failure of due diligence. Lack of proper

regard for risk management, ignoring the advice of experts

and penny pinching

Page 65: Lean maintenance - Shire Systems maintenance - Shire Systems

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Gambling with failureGambling with failure

Speed loss, quality loss, minor stops, yield loss

More expensive to fix Breakdown

Partial Failure

Breakdown!Production stops

Total Failure

Total Failurewith local

collateral damage

The escalation of The escalation of damagedamage……

The sky is the The sky is the limit for loss!limit for loss!

Total Failurewith

catastrophic damageBasically a failure of due diligence. Lack of proper

regard for risk management, ignoring the advice of experts

and penny pinching

Depressingly common – Just recall the many

petrochemical plant and railway disasters

Page 66: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures

Page 67: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures

Management emphasis must be on Management emphasis must be on equipment uptime and capability equipment uptime and capability improvement improvement –– not sidenot side--tracked onto tracked onto maintenance cost reduction maintenance cost reduction

Page 68: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

The proper job of maintenance is not The proper job of maintenance is not repairing failures but preventing repairing failures but preventing failuresfailures

Management emphasis must be on Management emphasis must be on equipment uptime and capability equipment uptime and capability improvement improvement –– not sidenot side--tracked onto tracked onto maintenance cost reduction maintenance cost reduction

This requires a switch from reactive This requires a switch from reactive firefire--fighting to engineeringfighting to engineering--led led analytical thinking and proactive analytical thinking and proactive leadershipleadership

Page 69: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be

Page 70: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be

Hmm, that’s what I’m really

paid to do

Page 71: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be

You should strive to You should strive to maximise the amount maximise the amount of maintenance you of maintenance you do do beforebefore failurefailure

Page 72: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failureM

aint

enan

ce C

osts

failurefailure

Your job is to prevent Your job is to prevent disruptive failure disruptive failure --thatthat’’s where your time s where your time and focus must beand focus must be

You should strive to You should strive to maximise the amount maximise the amount of maintenance you of maintenance you do do beforebefore failurefailure

Page 73: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

Page 74: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving

1

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

First the reliability improvement

st

Page 75: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving

1

2

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

First the reliability improvement

Then the maintenance cost saving

st

nd

Page 76: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving?

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

First the reliability improvement

Then the maintenance cost saving

Please don’t try to put the cart

before the horse!

Page 77: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving?

…that’s just common horse

sense!

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

First the reliability improvement

Then the maintenance cost saving

Page 78: Lean maintenance - Shire Systems maintenance - Shire Systems

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Proactive maintenanceProactive maintenance

After failureBefore failurefailurefailure

Cost Saving

In the process, maintenance costs reduce dramatically -and automatically by by half, or more, for half, or more, for somesome

First the reliability improvement

Then the maintenance cost saving

Do avoid shooting yourself in the foot!

Page 79: Lean maintenance - Shire Systems maintenance - Shire Systems

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Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

Reliability

Availability ∝ Reliability Maintainability

Operating Operating statestate

Down Down statestate

With acknowledgement to Richard C Lamb –’Availability Engineering & Management for

Manufacturing Plant Performance’

Page 80: Lean maintenance - Shire Systems maintenance - Shire Systems

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Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

ReliabilityOperating Operating statestate

Down Down statestate These influences

of ‘state’ are assured by TPM

Availability ∝ Reliability Maintainability

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TPM

later…

Page 81: Lean maintenance - Shire Systems maintenance - Shire Systems

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Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

ReliabilityOperating Operating statestate

Down Down statestate

Availability ∝ Reliability Maintainability

Is King!

Page 82: Lean maintenance - Shire Systems maintenance - Shire Systems

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Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

ReliabilityOperating Operating statestate

Down Down statestate

MTTR

Availability ∝ Reliability Maintainability

These are the prime indicators of performance

Mean Time Between Failure

Mean Time To Repair

MTBF

Page 83: Lean maintenance - Shire Systems maintenance - Shire Systems

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Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

ReliabilityOperating Operating statestate

Down Down statestate

MTTR

Availability ∝ Reliability Maintainability

This is the Royal

measure!

MTBF

Page 84: Lean maintenance - Shire Systems maintenance - Shire Systems

© 2009 Shire Systems Limited

Uptime Uptime -- Downtime state diagramDowntime state diagram

Maintainability

Plant Design, Operation and Maintenance

ReliabilityOperating Operating statestate

Down Down statestate

MTTR

Availability ∝ Reliability Maintainability

This is the Royal

measure!

MTBF

Measure and track MTBF for individual machines, cells, lines and whole sites

Maximise

Minimise

Page 85: Lean maintenance - Shire Systems maintenance - Shire Systems

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Take the lead!Take the lead!

Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details

Page 86: Lean maintenance - Shire Systems maintenance - Shire Systems

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Take the lead!Take the lead!

Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details

ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance

Page 87: Lean maintenance - Shire Systems maintenance - Shire Systems

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Take the lead!Take the lead!

Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details

ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance

You need to apply the Total You need to apply the Total Productive Maintenance framework to Productive Maintenance framework to achieve optimal manufacturing achieve optimal manufacturing performance

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TPM

performance

Page 88: Lean maintenance - Shire Systems maintenance - Shire Systems

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Take the lead!Take the lead!

Maintenance is the most complex of Maintenance is the most complex of all business processes, so your boss, all business processes, so your boss, production colleagues and finance production colleagues and finance director wondirector won’’t easily grasp the detailst easily grasp the details

ItIt’’s you that must take the lead in the s you that must take the lead in the move from reactive to proactive move from reactive to proactive maintenancemaintenance

You need to apply the Total You need to apply the Total Productive Maintenance framework to Productive Maintenance framework to achieve optimal manufacturing achieve optimal manufacturing performance performance

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TPMBut, expect to be lonely and sniped at! Your credibility is on the line and proper support is likely to be scarce - until you show them what success looks like

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Total Productive MaintenanceTotal Productive MaintenanceThe precondition of Lean manufacturingThe precondition of Lean manufacturing

Page 90: Lean maintenance - Shire Systems maintenance - Shire Systems

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TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste

TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects

Page 91: Lean maintenance - Shire Systems maintenance - Shire Systems

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TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste

TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects

TPMTPM’’s zeros zero--orientation is totally orientation is totally in line with the 7 Wastes in line with the 7 Wastes elimination of Lean elimination of Lean –– the the pursuit pursuit of perfectionof perfection

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TPM

Page 92: Lean maintenance - Shire Systems maintenance - Shire Systems

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TPM TPM -- pursuing perfection to cut wastepursuing perfection to cut waste

TPM seeks to add value by TPM seeks to add value by systematically reducing all types systematically reducing all types of loss to zero. The aim is of loss to zero. The aim is NONOaccidents, accidents, NONO breakdowns and breakdowns and NONO defectsdefects

TPMTPM’’s zeros zero--orientation is totally orientation is totally in line with the 7 Wastes in line with the 7 Wastes elimination of Lean elimination of Lean –– the the pursuit pursuit of perfectionof perfection

TPM is not just in line with lean; TPM is not just in line with lean; itit’’s a s a precondition of leanprecondition of lean. TPM . TPM is essential for Lean is essential for Lean manufacturing to flourishmanufacturing to flourish

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TPM

1

2

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

there are more…

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TOTALPRODUCTIVE MAINTENANCE

See the book ‘Introduction to TPM’by Seiichi Nakajima

Page 94: Lean maintenance - Shire Systems maintenance - Shire Systems

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

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TOTALPRODUCTIVE MAINTENANCE

These are the prerequisitesof performance

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

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TOTALPRODUCTIVE MAINTENANCE

Do these properly…

These are the prerequisitesof performance

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

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TOTALPRODUCTIVE MAINTENANCE

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Get this outcome…

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TOTALPRODUCTIVE MAINTENANCE

TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Operator or user maintenance!It’s great - but does depend on getting the co-operation of Management and others. If that’s not immediately forthcoming…

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

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TOTALPRODUCTIVE MAINTENANCE

Concentrate on these –you can control them

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TOTALPRODUCTIVE MAINTENANCE

TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Planning!

Planned preventive maintenancePLUS early detection and

planned prioritised repair of defects. 90% of work activity

should be ‘planned’

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TOTALPRODUCTIVE MAINTENANCE

TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’Training!

Increases overall equipment availability by countering the ‘common cause’ failure of

human error. >3% of available manhours should be allocated. Note, 80% of the maintenance workload is usually due to

human acts and omissions. Training is not simply about giving information, its about

changing attitude and behaviour

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TPM TPM -- the basic the basic ‘‘5 pillars5 pillars’’

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TOTALPRODUCTIVE MAINTENANCE

Engineering!It’s design configuration that determines

equipment’s intrinsic capability, reliability and maintainability. While initial design is crucial, operational needs change and the equipment must respond - so allocate 5% of manhours to engineering modifications. And, roll over your engineering analyses of equipment into failure countermeasures – your PPM tasks

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Caution! Caution! Engineering and management science is Engineering and management science is indispensable indispensable –– but never lose sight of but never lose sight of

your equipmentyour equipment’’s s basic carebasic care needsneeds

Page 103: Lean maintenance - Shire Systems maintenance - Shire Systems

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The basic care precondition The basic care precondition No asset abuse!No asset abuse!

Page 104: Lean maintenance - Shire Systems maintenance - Shire Systems

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The basic care precondition The basic care precondition No asset abuse!No asset abuse!

LUB

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3

TIG

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2

BASIC CARE

1

CLE

AN

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ALL

DE

FEC

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R

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4

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The basic care precondition The basic care precondition

LUB

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BASIC CARE

1

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4

No asset abuse!No asset abuse!

The prerequisites of successful maintenance and manufacturing performance. You’re going nowhere nice until these 4 conditions are substantially met

Page 106: Lean maintenance - Shire Systems maintenance - Shire Systems

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The basic care precondition The basic care precondition

LUB

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BASIC CARE

1

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No asset abuse!No asset abuse!

WatchkeepingEquipment ChecklistCleaned

TightenedLubed

No unreported defects

Page 107: Lean maintenance - Shire Systems maintenance - Shire Systems

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Performance managementPerformance managementGetting to gripsGetting to grips

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Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!

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Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!

However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement

Page 110: Lean maintenance - Shire Systems maintenance - Shire Systems

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Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!

However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement

Fundamentally, the problem is one of information overload. You just can’t assimilate and process new information fast enough to get ahead. And yet you’re continually pressured to take instantaneous, well-considered decisions. Unfortunately, when developing events get ahead of your ‘thinking’, you just slide further into chaos…

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Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!

However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovementThere’s a general need to become better organised

Page 112: Lean maintenance - Shire Systems maintenance - Shire Systems

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Getting to gripsGetting to gripsA fundamental principle of A fundamental principle of Lean is to make the problems Lean is to make the problems visible. visible. Drain the swamp!Drain the swamp!

However, when you're up to your However, when you're up to your backside in alligators backside in alligators –– constantly constantly arising urgent issuesarising urgent issues -- it's easy it's easy to get diverted away from your to get diverted away from your best intentions for continuous best intentions for continuous improvementimprovement

If you set up the means to drain If you set up the means to drain the swamp the swamp –– a a performance performance management systemmanagement system –– you can you can engage your crew in the program, engage your crew in the program, cull the alligators, gain control and cull the alligators, gain control and make your life a whole lot easier!make your life a whole lot easier!

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Performance managementPerformance management

The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance

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Performance managementPerformance management

The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance

Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them

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Performance managementPerformance management

The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance

Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them

Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement

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Performance managementPerformance management

The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance

Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them

Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement

Performance indicators promote visibility and Performance indicators promote visibility and alertness, together with organisationalertness, together with organisation--wide wide common purpose and agility common purpose and agility –– everyone sings everyone sings from the same hymn sheetfrom the same hymn sheet

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Performance managementPerformance management

The facilitating framework of a performance The facilitating framework of a performance management system provides the means to management system provides the means to achieve your goals and objectives achieve your goals and objectives -- enabling enabling you to assure and drive performanceyou to assure and drive performance

Using Using performance indicatorsperformance indicators you can set you can set quantified targets, then measure and compare quantified targets, then measure and compare current achievements against them current achievements against them

Definitive action can be taken in the light of Definitive action can be taken in the light of either adverse and positive trends either adverse and positive trends –– enabling enabling both control and continuous improvementboth control and continuous improvement

Performance indicators promote visibility and Performance indicators promote visibility and alertness, together with organisationalertness, together with organisation--wide wide common purpose and agility common purpose and agility –– everyone sings everyone sings from the same hymn sheetfrom the same hymn sheet

You’ll need to do this if you’re thinking of

implementing PAS 55

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Performance indicatorsPerformance indicators

There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))

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Performance indicatorsPerformance indicators

There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))

1.1. Lagging indicatorsLagging indicators –– historical, quantified historical, quantified statements of fact. They measure results. statements of fact. They measure results. Generally, they respond slowly to changes in Generally, they respond slowly to changes in the workplacethe workplace

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Performance indicatorsPerformance indicators

There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))

1.1. Lagging indicatorsLagging indicators –– historical, quantified historical, quantified statements of fact. They measure results. statements of fact. They measure results. Generally, they respond slowly to changes in Generally, they respond slowly to changes in the workplacethe workplace

2.2. Leading indicatorsLeading indicators –– predictive of a desired predictive of a desired future state. They measure inputs. They have future state. They measure inputs. They have a much faster response to changes in the a much faster response to changes in the workplaceworkplace

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Performance indicatorsPerformance indicators

There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))

1.1. Lagging indicatorsLagging indicators

2.2. Leading indicatorsLeading indicators

Understanding the nature of the two types of indicators –

their limitations and advantages - is crucial to

the realisation of effective maintenance management

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Performance indicatorsPerformance indicators

There are two categories of performance indicatorsThere are two categories of performance indicators((measures or metricsmeasures or metrics))

1.1. Lagging indicatorsLagging indicators

2.2. Leading indicatorsLeading indicators

There tends to be a somewhat fruitless pre-occupation with lagging indicators. While they quantify business-related goals, for example OEE, they are in fact useless for controlling the day-to-day, real-time activities of maintenance…

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Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s

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Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s

They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worsegetting better or worse

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Lagging indicatorsLagging indicators

What do I do next?

Lagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s

They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worsegetting better or worse

But lagging indicators But lagging indicators provide no provide no clue about the underlying causes of clue about the underlying causes of a problem a problem –– or a successor a success

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Lagging indicatorsLagging indicatorsLagging indicators are Lagging indicators are backwardbackward--lookinglooking.. They report historical They report historical performance performance –– not todaynot today’’s s

They inform you of the state youThey inform you of the state you’’ve ve arrived at arrived at -- they they ‘‘scorescore’’ how youhow you’’ve ve done. OEE is 40%, Availability is 55% done. OEE is 40%, Availability is 55% -- and so on. And they tell you if youand so on. And they tell you if you’’re re getting better or worse getting better or worse

But lagging indicators But lagging indicators provide no provide no clue about the underlying causes of clue about the underlying causes of a problem a problem –– or a successor a success

Give me visibility!

Resulting actions are Resulting actions are corrective corrective and and reactive reactive –– largely based on blind largely based on blind guesswork! guesswork! Euphemistically known as intuitionEuphemistically known as intuition……

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Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicatorsleading indicators

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Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators

Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievement

AND

leading indicators

specific performance achievement

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Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators

Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievementspecific performance achievement

The relationship between the leading The relationship between the leading and lagging indicators is one of and lagging indicators is one of causecause--andand--effect

AND

leading indicators

effect

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Leading indicatorsLeading indicatorsFor For visibilityvisibility and and proactive controlproactive control, , you need you need leading indicators

Every lagging indicator has an Every lagging indicator has an associated set of driving influences associated set of driving influences --each influence is measured by a each influence is measured by a leading indicator quantifying its leading indicator quantifying its specific performance achievementspecific performance achievement

The relationship between the leading The relationship between the leading and lagging indicators is one of and lagging indicators is one of causecause--andand--effecteffect

The highest impact, The highest impact, critical fewcritical fewleading indicators should be chosen leading indicators should be chosen for each lagging indicator for each lagging indicator ––discarding the discarding the trivial many

AND

leading indicators

trivial many

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Leading indicatorsLeading indicators

Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors

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Leading indicatorsLeading indicators

MTB

F

MTT

R

OIF

D

OEE IFR

Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors

Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay

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Leading indicatorsLeading indicators

MTB

F

MTT

R

OIF

D

OEE IFR

Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors

Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay

The time delay provides space to reflect The time delay provides space to reflect on progress, adjust emphasis and take on progress, adjust emphasis and take definitive action. Resulting actions are definitive action. Resulting actions are therefore therefore preventivepreventive or or improvementimprovement

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Leading indicatorsLeading indicators

MTB

F

MTT

R

OIF

D

OEE IFR

Leading indicators are used to identifyLeading indicators are used to identifytrendstrends –– theythey’’re NOT passre NOT pass--fail monitorsfail monitors

Lagging indicators inexorably follow the Lagging indicators inexorably follow the trend of their associated leading trend of their associated leading indicators indicators -- but with some but with some time delaytime delay

The time delay provides space to reflect The time delay provides space to reflect on progress, adjust emphasis and take on progress, adjust emphasis and take definitive action. Resulting actions are definitive action. Resulting actions are therefore therefore preventivepreventive or or improvementimprovement

Without leading indicators, you canWithout leading indicators, you can’’t t prevent failure or properly action prevent failure or properly action improvements improvements –– youyou’’ll just be ll just be thrashing thrashing around in the darkaround in the dark

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Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practice

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Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etc

British Standard BS EN 15341,

Maintenance Key Performance Indicators

BESTPRACTICE MAKESPERFECT

Society for Maintenance & Reliability Professionals

BSI, SMRP, etc

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Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc

Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score

British Standard BS EN 15341,

Maintenance Key Performance Indicators

BESTPRACTICE MAKESPERFECT

Society for Maintenance & Reliability Professionals

keep the score

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Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc

Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score keep the score

British Standard BS EN 15341,

Maintenance Key Performance Indicators

BESTPRACTICE MAKESPERFECT

Society for Maintenance & Reliability Professionals

In essence, the current ‘reading’ of a leading indicator is a measure of the present success of the application of its associated best practice

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Leading indicatorsLeading indicatorsEach leading indicator is associated with a Each leading indicator is associated with a best practicebest practiceBest practices are identified and selected Best practices are identified and selected using using benchmarking benchmarking –– you target the best you target the best available sources available sources –– BSI, SMRP, etcBSI, SMRP, etc

Your management focus must be on theYour management focus must be on thepracticespractices -- and on the and on the behavioursbehaviours of of employees. These are the real employees. These are the real determinants of success. Indicators only determinants of success. Indicators only keep the score keep the score

You may gain, but can never sustain, You may gain, but can never sustain, competitive business performance without competitive business performance without achieving the prerequisite level of achieving the prerequisite level of competency in each contributory best competency in each contributory best practice practice –– embedded embedded competency

British Standard BS EN 15341,

Maintenance Key Performance Indicators

BESTPRACTICE MAKESPERFECT

Society for Maintenance & Reliability Professionals

competency

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Your Dashboard of indicatorsYour Dashboard of indicators

Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem

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Your Dashboard of indicatorsYour Dashboard of indicators

Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem

The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard

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Your Dashboard of indicatorsYour Dashboard of indicators

Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem

The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard

Those with a late model AC Cobra will recognise this one…

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Your Dashboard of indicatorsYour Dashboard of indicators

Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem

The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard

Each indicator provides information on Each indicator provides information on a specific and crucial aspect of a a specific and crucial aspect of a systemsystem’’s health and performance s health and performance –– to to safeguard the system so it can safeguard the system so it can complete its mission successfullycomplete its mission successfully

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Your Dashboard of indicatorsYour Dashboard of indicators

Multiple indicators are essential to Multiple indicators are essential to monitor the health of a monitor the health of a ‘‘systemsystem’’ and and warn of a particular developing warn of a particular developing condition before it becomes a problemcondition before it becomes a problem

The interrelated leading indicators are The interrelated leading indicators are monitored in aggregate monitored in aggregate –– like the set of like the set of instruments on a carinstruments on a car’’s s dashboarddashboard

Each indicator provides information on Each indicator provides information on a specific and crucial aspect of a a specific and crucial aspect of a systemsystem’’s health and performance s health and performance –– to to safeguard the system so it can safeguard the system so it can complete its mission successfullycomplete its mission successfully

Nevertheless, some individuals still run out of fuel and even blow up their engines! Success is not assured without prerequisite attentive and disciplined behaviour. Good practices and diligent behaviour remain paramount

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Relating all this to the maintenance Relating all this to the maintenance management processmanagement process

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Maintenance performance managementMaintenance performance management

A A process process is a sequence of activities is a sequence of activities transforming inputs into outputs transforming inputs into outputs –– a a needed resultneeded result……

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTS

A A process process is a sequence of activities is a sequence of activities transforming inputs into outputs transforming inputs into outputs –– a a needed resultneeded result……

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTS

LabourParts & MaterialsToolsFacilitiesTechnical informationStandards & RegulationsManagement

The inputs and outputs of the Maintenance Management The inputs and outputs of the Maintenance Management process are well documented and undisputedprocess are well documented and undisputed……

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTSINPUTS

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTS

A lagging indicator of performance measures and reports a process output –

it’s a results measure

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTS

A lagging indicator of performance measures and reports a process output –

it’s a results measure

OEE, MTBF, MTTR, Accident Frequency, etc

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTS

But it presents you with a big dilemma -

How to act?

ActAct What?

How? Where?

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

INPUTS OUTPUTSBecause of the many influences

on output achievement, the lagging indicator won’t tell you

what corrective action is needed to control or improve the result

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTS

That’s dangerous!Events are outside of

your control – so calamities can occur

INPUTS

Plant AvailabilityProcess capabilityRegulatory compliance(at lowest cost)

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTS

CalamityINPUTS

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTS

CalamityThis is the reason why the Authorities impose Health, Safety and Environmental Regulations to make organisations think and plan more about what they’re doing

INPUTS

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTS

Calamity

The previous absence of a serious event cannot be taken as an indication and vindication that everything is well under control

INPUTS

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTS

Calamity

No matter what it is, when a credible event is totally unacceptable, senior management must ensure effective preventive controls are devised, put in place and are working

INPUTS

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Maintenance performance managementMaintenance performance management

OUTPUTS

ActAct

MaintenanceManagement

A leading indicator of performance measures a specific process input and provides a trigger for definitive action…

INPUTS

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Maintenance performance managementMaintenance performance management

ActAct

MaintenanceManagement

OUTPUTS

…enabling preventive, feedforward control of

the needed output

INPUTS

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Maintenance performance managementMaintenance performance management

ActAct

MaintenanceManagement

OUTPUTS

it gives you time to assess the situation and take

preventive action to avoid an indicated developing problem

INPUTS

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTSINPUTS

Leading indicators are task-specific - so you need many of them!

ActAct

ActAct

ActAct

ActAct ActAct

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTSINPUTSActAct

ActAct

ActAct

ActAct ActAct

5 to 10 measuresBut strive to keep the number down to the critical few

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Maintenance performance managementMaintenance performance management

MaintenanceManagement

OUTPUTSINPUTSActAct

ActAct

ActAct

ActAct ActAct

5 to 10 measures

You are the controlling mind. Choice of your indictor set -your Dashboard - is critical. It must balance process complexity against your finite mental capacity to assess, plan and coordinate activities

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Aligning business goals and Aligning business goals and performance indicatorsperformance indicators

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Aligning performance with business goalsAligning performance with business goalsThe The Performance Performance PyramidPyramid model for model for integrated performance integrated performance management was first management was first proposed by Wang proposed by Wang Laboratories in the late Laboratories in the late 1980s

Quality

Flexibility(Agility)

MarketMeasures

CorporateVision

Delivery(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

CustomerSatisfaction Productivity

FinancialMeasures

Operations(Production, Maintenance, Logistics…)

1980s

With acknowledgement to Wang Laboratories

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Aligning performance with business goalsAligning performance with business goalsThe The Performance Performance PyramidPyramid model for model for integrated performance integrated performance management was first management was first proposed by Wang proposed by Wang Laboratories in the late Laboratories in the late 1980s1980s

The The business objectivesbusiness objectives–– as defined in the as defined in the Boardroom Boardroom –– are are deployed down and deployed down and across the organisation. across the organisation. Targets are derived & set Targets are derived & set for factors in each activity for factors in each activity contributing to success

Quality

Flexibility(Agility)

MarketMeasures

CorporateVision

Delivery(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

CustomerSatisfaction Productivity

FinancialMeasures

Operations(Production, Maintenance, Logistics…)

Depl

oym

ent

Depl

oym

ent

contributing to success With acknowledgement to Wang Laboratories

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Aligning performance with business goalsAligning performance with business goals

Quality

Flexibility(Agility)

MarketMeasures

CorporateVision

Delivery(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

CustomerSatisfaction Productivity

FinancialMeasures

Operations(Production, Maintenance, Logistics…)

Goals are cascaded down to the operational level

OEE>85%

Depl

oym

ent

Depl

oym

ent

With acknowledgement to Wang Laboratories

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Aligning performance with business goalsAligning performance with business goals

Quality

Flexibility(Agility)

MarketMeasures

CorporateVision

Delivery(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

CustomerSatisfaction Productivity

FinancialMeasures

Operations(Production, Maintenance, Logistics…)

Performance indicators roll upwards

Performance indicatorsPerformance indicatorsare the means of are the means of assuring operational assuring operational alignment with business alignment with business objectives. Theyobjectives. They’’re re reported up and across reported up and across the organisation

Delivery

Deliverythe organisation

With acknowledgement to Wang Laboratories

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Aligning performance with business goalsAligning performance with business goals

Quality

Flexibility(Agility)

MarketMeasures

CorporateVision

Delivery(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

CustomerSatisfaction Productivity

FinancialMeasures

Operations(Production, Maintenance, Logistics…)

With acknowledgement to Wang Laboratories

Performance indicators Performance indicators are the means of are the means of assuring operational assuring operational alignment with business alignment with business objectives. Theyobjectives. They’’re re reported up and across reported up and across the organisationthe organisation

Quality, Delivery, Quality, Delivery, Cycle TimeCycle Time and and Cost Cost are the performance are the performance characteristics of ALL characteristics of ALL operational activitiesoperational activities……

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

OperationsIn business, performance

indicators can be quantified for every operational activity,

including maintenance, in terms of these 4 basic characteristics

Enterprise goals

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

Operations

For example, First Time Through, Takt Time,

On Time In Full Delivery,Injury Frequency,

Production Rate, OEE, MTBF, Unit Cost…

Enterprise goals

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

Operations

If you can’t put a number on it, you can’t measure it – and, if

you can’t measure it, you can’t manage it. Trite but true!

Enterprise goals

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Aligning performance with business goalsAligning performance with business goals

Enterprise goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

Operations

The performance indicators monitor the most important

determinants of success and provide the stimulus for action

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Aligning performance with business goalsAligning performance with business goals

Enterprise goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

Operations

The purpose of measurement is to gain information on which to act – if no action, you're wasting your time and just throwing good money away after bad

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

OperationsIn manufacturing and other

equipment-intensive industries, maintenance provides the

prerequisite magic ingredient, assuring successful business

performance

Enterprise goals

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

OperationsAvailabilityAvailability CapabilityCapability

(Process) ComplianceCompliance CostCost(Lowest)

Enterprise goals

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Aligning performance with business goalsAligning performance with business goals

QualityDelivery

(Quantity & Timeliness)

Cost(Waste)

Cycle Time

(Process)

OperationsAvailabilityAvailability CapabilityCapability

(Process) ComplianceCompliance CostCost(Lowest)

Enterprise goals

Maintenance delivers these essential conditions - the

prerequisites of manufacturing competitiveness and success

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Leading indicators of Leading indicators of maintenance performancemaintenance performance

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AND

OEE, MTBF, MTTR…

There are many influences There are many influences on maintenance performanceon maintenance performance

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

…more

Cost(Lowest)

Compliance

Capability(Process)

Availability

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework

British Standard BS EN 15341

Maintenance Key Performance Indicators

AN

D

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

Cost(Lowest)

Compliance

Capability(Process)

Availability

…more

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework

These are ‘big hitter’indicators applying to MTBF, MTTR - and

hence OEEA

ND

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

Cost(Lowest)

Compliance

Capability(Process)

Availability

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more

For leading indicators, the questions to ask are: which factors (influencers, drivers) push the system to a new

desired state? Which factors are worth monitoring?

AN

D

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

Cost(Lowest)

Compliance

Capability(Process)

Availability

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more

AN

D

Because the greatest potential for control exists at the point of action, ‘self control’ by the individual on the spot tends is ultimately the most effective control. The best leading indicators are therefore those which aid self control. This is the reason why all individuals

involved in a process must clearly understand why their contribution is

important and how it contributes to success

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

Cost(Lowest)

Compliance

Capability(Process)

Availability

British Standard BS EN 15341

Maintenance Key Performance Indicators

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more

Most of these and others are defined in the 2007

British Standard

AN

D

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

Cost(Lowest)

Compliance

Capability(Process)

Availability

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework …more

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

British Standard BS EN 15341

Maintenance Key Performance Indicators

AN

D

In addition, you can refer to the Whitepaper

section of the Shire Systems website

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Leading indicators of maintenance performanceLeading indicators of maintenance performance

…more

British Standard BS EN 15341

Maintenance Key Performance Indicators

Risk analysis BSI T18Planning BSI T19Operator maintenance BSI O4Planned & scheduled work BSI O5*Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Preventive maintenance BSI O18*Condition-based maintenance BSI O19Schedule compliance BSI O22*Training BSI O23Response timeBacklogManpower utilisationRework

MTBFMTBF

MTTRMTTR++ A

ND

Use of a CMMS is also a stated BSI leading indicator of maintenance performance

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Leading indicators of maintenance performanceLeading indicators of maintenance performanceRisk analysis BSI T18Planning BSI T19Operator maintenance BSI O4

Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Condition-based maintenance BSI O19

Training ratio BSI O23Response timeBacklogManpower utilisationRework

Planned & scheduled work BSI O5Planned & scheduled work BSI O5

Preventive maintenance BSI O18Preventive maintenance BSI O18

Schedule compliance BSI O22Schedule compliance BSI O22

Planning is pre-eminent!

…more

AN

DMTBFMTBF

MTTRMTTR++

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Leading indicators of maintenance performanceLeading indicators of maintenance performanceRisk analysis BSI T18Planning BSI T19Operator maintenance BSI O4

Continuous improvement BSI O8Multiskilled BSI O15Corrective maintenance BSI O16Emergency maintenance BSI O17

Condition-based maintenance BSI O19

Training ratio BSI O23Response timeBacklogManpower utilisationRework

Planned & scheduled work BSI O5Planned & scheduled work BSI O5

Preventive maintenance BSI O18Preventive maintenance BSI O18

Schedule compliance BSI O22Schedule compliance BSI O22

…more

AN

D

Besides the huge cost savings, sticking to plan

reduces turbulence, creates order, eases personnel

tension and stabilises morale

MTBFMTBF

MTTRMTTR++

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Getting goingGetting going

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The two main aspects of performanceThe two main aspects of performance

For startersFor starters, evaluate two main aspects of , evaluate two main aspects of your maintenance performanceyour maintenance performance

First, improvements in equipment First, improvements in equipment reliability, maintainability and capability to reliability, maintainability and capability to increase plant effectiveness and product increase plant effectiveness and product qualityquality

Second, improvement in the efficiency of Second, improvement in the efficiency of maintenance work itself. All work must be maintenance work itself. All work must be carried out using the best, most carried out using the best, most economical methods economical methods –– and your and your technicians should maximise the amount technicians should maximise the amount of time they spend wielding tools for gain of time they spend wielding tools for gain

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Performance management questionsPerformance management questions

And ask yourselfAnd ask yourself

WhatWhat’’s causing me and my organisation the most s causing me and my organisation the most pain? List the ten biggest issues you are involved in pain? List the ten biggest issues you are involved in and establish their underlying patternsand establish their underlying patterns

1.1. What are am I doing right?What are am I doing right?

2.2. What do I need to improve?What do I need to improve?

3.3. What do I need to start doing?What do I need to start doing?

4.4. What do I need to stop doing?What do I need to stop doing?

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Select the Critical Few indicatorsSelect the Critical Few indicators

Choose a Choose a ‘‘handfulhandful’’ of highof high--impact indicators to get impact indicators to get going with, say 5 going with, say 5 -- for examplefor example

1.1. Planned & scheduled workPlanned & scheduled work

2.2. Preventive MaintenancePreventive Maintenance

3.3. Schedule complianceSchedule compliance

4.4. Response timeResponse time

5.5. Rework rateRework rate

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The contribution of The contribution of information management information management systems systems –– your CMMSyour CMMS……

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The essential contribution of CMMSThe essential contribution of CMMS

To get the information outputs needed for performance To get the information outputs needed for performance management, you must have the right data inputs. management, you must have the right data inputs. Common sense!Common sense!

Good data collection and analysis are key requirements Good data collection and analysis are key requirements for a successful systemfor a successful system

ThereThere’’s a morass of data to slice, dice and process in s a morass of data to slice, dice and process in order to obtain pertinent, usable performance order to obtain pertinent, usable performance informationinformation

Accounting systems are not definitive enough to handle Accounting systems are not definitive enough to handle the detail required. The breakdown and tracking can the detail required. The breakdown and tracking can only be done by the Work Order system within a CMMSonly be done by the Work Order system within a CMMS

A CMMS can also help you to enforce data discipline A CMMS can also help you to enforce data discipline with userwith user--prompts and mandatory fieldsprompts and mandatory fields

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Lean is about the elimination of Lean is about the elimination of waste waste –– so only collect and process so only collect and process the the minimum dataminimum data to satisfy your to satisfy your performance information needs. performance information needs.

That is, data for immediate needs That is, data for immediate needs andand, , IDEALLY, for the medium term IDEALLY, for the medium term --because because longer term needs will longer term needs will undoubtedly have current data undoubtedly have current data collection requirementscollection requirements

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The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

CMMS

Compliance & Performance Monitoring & Control information

Codes, Standards & Regulations

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Compliance & Performance Monitoring & Control information

R

is

k

The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

CMMS

Codes, Standards and

RegulationsThe management of

maintenance is fundamentally about

the mitigation of business risk

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Compliance & Performance Monitoring & Control information

R

is

k

The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

CMMS

Codes, Standards and

Regulations

Using a Work Order system with the workflow steps – Approve, Plan, Schedule and Launch

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Compliance & Performance Monitoring & Control information

R

is

k

The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

CMMS

Besides the workflow steps, Work

Management is complex because it

involves many divers sub-processes…

Codes, Standards & Regulations

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R

is

k

The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

Compliance & Performance Monitoring & Control information

CMMS

Service Management

ContractManagement

Labour Management

Materials Management

Purchasing Management

FinancialManagement

SHE Compliance

Warranties,Waste, etc

Defect Management

Codes, Standards & Regulations

more…

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Compliance & Performance Monitoring & Control information

Codes, Standards & Regulations

R

is

k

The essential contribution of CMMSThe essential contribution of CMMS

Technical Management

Asset Technical & Economic Data

Work Management

Business Objectives

CMMS

Service Management

ContractManagement

Labour Management

Materials Management

Purchasing Management

FinancialManagement

SHE Compliance

Warranties,Waste, etc

Defect ManagementThis lies at the heart of

maintenance - but is often completely overwhelmed by the many other distracting, but lesser, considerations

more…

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Data collection, slicing and dicingData collection, slicing and dicing

WorkloadWorkload

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Slice & dice Slice & dice –– classifying your workloadclassifying your workload

Preventive Maintenance

Predictive Inspection

&Testing

Programmed Maintenance

(cycle> 1year)

Grounds Care

Corrective Repairs

(Emergency & Routine)

Service Requests

(Non-Maintenance)

Replacementof Obsolete

Items

Minor Modifications

Rehabilitation&

Modernisation

Additions &

Major Alterations

Total Workload

It is essential that the total Workload is carefully divided into categories to facilitate its technical and

economic control

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Slice & dice Slice & dice –– classifying your workloadclassifying your workload

Preventive Maintenance

Predictive Inspection

&Testing

Programmed Maintenance

(cycle> 1year)

Grounds Care

Corrective Repairs

(Emergency & Routine)

Service Requests

(Non-Maintenance)

Replacementof Obsolete

Items

Minor Modifications

Rehabilitation&

Modernisation

Additions &

Major Alterations

According to your needs, there can be other Work Types

…more

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Slice & dice Slice & dice –– classifying your workloadclassifying your workload

Preventive Maintenance

Predictive Inspection

&Testing

Programmed Maintenance

(cycle> 1year)

Grounds Care

Corrective Repairs

(Emergency & Routine)

Service Requests

(Non-Maintenance)

Replacementof Obsolete

Items

Minor Modifications

Rehabilitation&

Modernisation

Additions &

Major Alterations

It’s got to work for you!

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Slice & dice Slice & dice –– classifying your workloadclassifying your workload

Preventive Maintenance

Predictive Inspection

&Testing

Programmed Maintenance

(cycle> 1year)

Grounds Care

Corrective Repairs

(Emergency & Routine)

Service Requests

(Non-Maintenance)

Replacementof Obsolete

Items

Minor Modifications

Rehabilitation&

Modernisation

Additions &

Major Alterations

It’s got to work for you!

You can add new Work Types at any time - but when there’s no existing data, your

system will not be able to present you with associated historical trends. Hence, while focusing on immediate imperatives, it’s best to try to foresee and provide for

your future information needs into the 2 to 3 year term

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Slice & dice Slice & dice –– classifying your workloadclassifying your workload

Preventive Maintenance

Predictive Inspection

&Testing

Programmed Maintenance

(cycle> 1year)

Grounds Care

Corrective Repairs

(Emergency & Routine)

Service Requests

(Non-Maintenance)

Minor Modifications

Rehabilitation&

Modernisation

Additions &

Major Alterations

CMMSReplacementof Obsolete

Items

It’s easy to set up, track and control as many Work Types as you need in your CMMS

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Data collection, slicing and dicingData collection, slicing and dicing

MaterialsMaterials

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Slice & dice Slice & dice –– classifying materialsclassifying materials

Common spares

Refurbishable spares

Plant spares

Plant consumables

Insurance spares

Engineers supplies

Maintenance consumables

General supplies

Tools & Instruments

Project materials

Surplus materials

Lubricants

Total materials movements and inventories (Stores

Stock) must be divided up to facilitate technical and

economic control

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Slice & dice Slice & dice –– classifying materialsclassifying materials

Common spares

Refurbishable spares

Plant spares

Plant consumables

Insurance spares

Engineers supplies

Maintenance consumables

General supplies

Tools & Instruments

Project materials

Surplus materials

Lubricants

Control and optimisation of stores value (Working Capital) requires targets to be set and values monitored for stock holding with different ‘movement’characteristics - fast moving (<< I year),slow moving (> 1 year), insurance and surplus materials

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Slice & dice Slice & dice –– classifying materialsclassifying materials

Common spares

Refurbishable spares

Plant spares

Plant consumables

Insurance spares

Engineers supplies

Maintenance consumables

General supplies

Tools & Instruments

Project materials

Surplus materials

Lubricants

CMMS

It’s easy to set up, track and control multiple

Material Types, movement categories and storage locations in your CMMS

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Slice & dice Slice & dice –– classifying materialsclassifying materials

Common spares

Refurbishable spares

Plant spares

Plant consumables

Insurance spares

Engineers supplies

Maintenance consumables

General supplies

Tools & Instruments

Project materials

Surplus materials

Lubricants

CMMS

It’s easy to set up, track and control multiple

Material Types, movement categories and storage locations in your CMMS

It’s got to work for you!

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Data collection, slicing and dicingData collection, slicing and dicing

Asset IndentureAsset Indenture

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An element of a Part – of importance in failure reporting only

Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture LevelsConglomerate

Company

Site

Area

Unit

System (Cell)

Asset

Assembly

Sub-assembly

Part

Location hierarchy

System hierarchy

Sub-Unit

Element

geographical

assembly

……your your ‘‘Assets TreeAssets Tree’’

Where?

What?

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Location hierarchygeographical

Conglomerate

Company

Site

Area

Unit

System (Cell)

Asset

Assembly

Sub-assembly

Part

Sub-Unit

Element

System hierarchyassembly

An element of a Part – of importance in failure reporting only. For instance, a gear tooth

Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels……your your ‘‘Assets TreeAssets Tree’’

The number of geographical and assembly Indenture Levels needed depends on the size of your organisation, its industrial sector, your own maintenance strategy - and your organisation’s maintenance maturity

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Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels

Location hierarchygeographical

Conglomerate

Company

Site

Area

Unit

System (Cell)

Asset

Assembly

Sub-assembly

Part

Sub-Unit

Element

System hierarchyassembly

CMMS

It’s easy to set up, track, control and consolidate

as many Asset Indenture Levels as you

like in your CMMS

An element of a Part – of importance in failure reporting only

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Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture Levels

Location hierarchygeographical

Conglomerate

Company

Site

Area

Unit

System (Cell)

Asset

Assembly

Sub-assembly

Part

Sub-Unit

Element

System hierarchyassembly

CMMS

It’s easy to set up, track, control and consolidate

as many Asset Indenture Levels as you

like in your CMMS

It’s got to work for you!

An element of a Part – of importance in failure reporting only

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Slice & dice Slice & dice -- Asset Indenture LevelsAsset Indenture LevelsConglomerate

Company

Site

Area

Unit

System (Cell)

Asset

Assembly

Sub-assembly

Part

Sub-Unit

Element

Location hierarchygeographical

System hierarchyassembly

An element of a Part – of importance in failure reporting only

CMMS

These also link into the materials management

component of your CMMS

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Data collection, slicing and dicingData collection, slicing and dicing

Failures and FaultsFailures and Faults

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

A Failure is an event

A Fault is a state

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Following a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

Slice & dice Slice & dice –– Failures and FaultsFailures and Faults

e.g.

Conveyor trips out on overload

e.g.

Renewed bearing, seals and oil

Notes:

Logged as a Temporary Repair - helical wheel damaged and no spare available. On order, delivery 10 days max

e.g.

Motor gearbox

e.g.

Bearing seized

e.g.

Pile-up Conveyor Line 2

FAULT

Failure

FaultArea

FaultMode

FaultAction

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

CMMS

It’s easy to categorise, log and

analyse all plant failures and actions

in your CMMS

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

CMMS

Standard ‘libraries’ can be defined in the CMMS for all these - to

provide a structured framework, add engineering ‘intelligence’ and

speed up data capture and analysis

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

CMMS

Standard ‘libraries’ can be defined in the CMMS for all these - to

provide a structured framework, add engineering ‘intelligence’ and

speed up data capture and analysis

It’s got to work for you!

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Slice & dice Slice & dice –– Failures and FaultsFailures and FaultsFollowing a Following a FailureFailure, an asset , an asset has one or morehas one or more Faults Faults requiring actionrequiring action……

FAULT

Failure

FaultArea

FaultMode

FaultAction

CMMS

Note: Failures (breakdowns) are lagging indicators of performance. They invariably have systemic root causes. Therefore, focus on the leading performance indicators driving the elimination of these disruptive events -obviously the same ones as for MTBF!

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In summaryIn summary

Because of its direct impact on equipment capacity Because of its direct impact on equipment capacity and capability and capability -- its transforming potential on product its transforming potential on product quality, safety and production costs, maintenance is quality, safety and production costs, maintenance is a high leverage contributor to business a high leverage contributor to business competitiveness and profitabilitycompetitiveness and profitability

Costs are important, but a prime emphasis on Costs are important, but a prime emphasis on maintenance costmaintenance cost--cutting will not lead to sustainable cutting will not lead to sustainable business performance improvementbusiness performance improvement

Investing in plant reliability and utilisation Investing in plant reliability and utilisation improvement carries with it the promise that, along improvement carries with it the promise that, along with product quality, production capacity and safety, with product quality, production capacity and safety, costs will automatically decrease as a resultcosts will automatically decrease as a result

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In summaryIn summary

The byThe by--product of better planning and less repairs is product of better planning and less repairs is lower maintenance expense. And there will be more lower maintenance expense. And there will be more production for no extra capital cost, as the hidden production for no extra capital cost, as the hidden factory comes on streamfactory comes on stream

To survive the recession, being good just isnTo survive the recession, being good just isn’’t good t good enough enough –– youyou’’ll have to be excellent. To be excellent, ll have to be excellent. To be excellent, youyou’’ve got to drive increased performance using a ve got to drive increased performance using a slick performance management system slick performance management system –– you need a you need a wellwell--configured CMMSconfigured CMMS

The Engineering Manager has to lead the way for all The Engineering Manager has to lead the way for all these things to happenthese things to happen

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This is the end of the This is the end of the Maintec 2009 presentation Maintec 2009 presentation

If youIf you’’re interested in more re interested in more reflections on performance reflections on performance indicators, please read onindicators, please read on……

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Why performance Why performance indicators are neededindicators are needed

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Why we need performance indicatorsWhy we need performance indicators

Corporate strategy and goals are usually too abstract Corporate strategy and goals are usually too abstract –– too woollytoo woolly-- to guide managers and others in their dayto guide managers and others in their day--toto--day decisions and day decisions and actionsactions

Performance indicators, particularly leading indicators, make Performance indicators, particularly leading indicators, make abstract strategy more understandable and relatable. The abstract strategy more understandable and relatable. The translation of corporate vision into clearly defined workplace translation of corporate vision into clearly defined workplace practices and hard measures practices and hard measures -- deployment deployment -- enables individuals enables individuals to understand their required contribution and take the local, onto understand their required contribution and take the local, on--thethe--spot action necessary to achieve corporate goalsspot action necessary to achieve corporate goals

Fundamentally, performance measures are deployed to influence Fundamentally, performance measures are deployed to influence and change behaviours for the better on the factory floor and inand change behaviours for the better on the factory floor and inoffice suites. They act to align attitudes and actions with office suites. They act to align attitudes and actions with organisational needs. Performance indicators get everyone organisational needs. Performance indicators get everyone signing for the same hymn sheet; they have a positive effect on signing for the same hymn sheet; they have a positive effect on individual behaviour; they foster advantageous peerindividual behaviour; they foster advantageous peer--pressurepressure

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Why we need performance indicatorsWhy we need performance indicators

The effective use of leading performance indicators takes the The effective use of leading performance indicators takes the guesswork out of managing a complex process. Without the guesswork out of managing a complex process. Without the necessary understanding of underlying process dynamics that the necessary understanding of underlying process dynamics that the leading indicator thoughtleading indicator thought--process brings, the only alternative is to process brings, the only alternative is to make assumptions and rely on luck. Rational, factmake assumptions and rely on luck. Rational, fact--based decisionbased decision--making is a much better approach than thrashing around in the making is a much better approach than thrashing around in the darkdark

Business process and procedural improvements have traditionally Business process and procedural improvements have traditionally been implemented as a result of investigations triggered by been implemented as a result of investigations triggered by customer complaints, accidents and other mishaps. Progress has customer complaints, accidents and other mishaps. Progress has been based on the highlybeen based on the highly--favoured reactive management model of: favoured reactive management model of: First the incident, then the corrective actionFirst the incident, then the corrective action -- a a ‘‘learning from learning from failurefailure’’ approach. This approach flourishes in industry and has approach. This approach flourishes in industry and has been recently updated with the new been recently updated with the new ‘‘Lessons LearnedLessons Learned’’ addition to addition to project management practice!project management practice!

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Why we need performance indicatorsWhy we need performance indicators

The traditional, backwardThe traditional, backward--looking approach uses lagging indicators looking approach uses lagging indicators to monitor performance. The big concern is that these indicatorsto monitor performance. The big concern is that these indicators DO DO NOT provide the requisite management information and insight to NOT provide the requisite management information and insight to prevent future untoward eventsprevent future untoward events

ItIt’’s clearly evident that the previous absence of an untoward events clearly evident that the previous absence of an untoward event is is not necessarily an indication and vindication that all is honky not necessarily an indication and vindication that all is honky dory dory and activities are under effective control and activities are under effective control –– while there may well be while there may well be historical patterns,historical patterns, the future is always different from the pastthe future is always different from the past

The reactive approach is not acceptable where health and safety The reactive approach is not acceptable where health and safety are concerned. are concerned. Prevention is keyPrevention is key. The Government has stepped in . The Government has stepped in over the years with Regulations to make organisations think and over the years with Regulations to make organisations think and plan more about what theyplan more about what they’’re doing. Often judged as onerous by re doing. Often judged as onerous by some managements, the proactive, best practice approach sought some managements, the proactive, best practice approach sought by the authorities is by the authorities is –– naively perhaps naively perhaps -- not always applied to not always applied to managing performance in other areas of the businessmanaging performance in other areas of the business

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Why we need performance indicatorsWhy we need performance indicators

Legislation and regulatory requirements Legislation and regulatory requirements -- compliancecompliance -- define the define the organisationorganisation’’s minimum acceptable performances minimum acceptable performance

These compliance basics are not negotiable by senior These compliance basics are not negotiable by senior management. management. Regulatory measures therefore provide you, the Regulatory measures therefore provide you, the Engineering Manager, with the power base to leverage Engineering Manager, with the power base to leverage maintenance advantage and build on the established maintenance advantage and build on the established compliance practices to apply good sense and increase compliance practices to apply good sense and increase operational performance overalloperational performance overall

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The characteristics of good The characteristics of good performance indicatorsperformance indicators

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Characteristics of good performance indicatorsCharacteristics of good performance indicators

To be effective, performance indicators shouldTo be effective, performance indicators should……

1.1. Be timely, objective and unambiguous Be timely, objective and unambiguous -- easy easy to understandto understand

2.2. Be accepted, owned and under the control of Be accepted, owned and under the control of the maintenance team and other individuals the maintenance team and other individuals able to directly influence performance on the able to directly influence performance on the day, on the hourday, on the hour

3.3. Provide immediate and reliable indications of Provide immediate and reliable indications of the present level of performance against the the present level of performance against the predefined targets and any trend in predefined targets and any trend in improvement or deterioration improvement or deterioration –– operational operational maintenance is essentially a realmaintenance is essentially a real--time activity time activity needing realneeding real--time information feedbacktime information feedback

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Characteristics of good performance indicatorsCharacteristics of good performance indicators

4.4. Provide information that can clearly guide Provide information that can clearly guide and drive appropriate action to improve and drive appropriate action to improve performanceperformance

5.5. Respond sensitively to the work and Respond sensitively to the work and procedural changes made to influence itprocedural changes made to influence it

6.6. Be easy to measure and collect. It should Be easy to measure and collect. It should be cost efficient in terms of the personal be cost efficient in terms of the personal effort and equipment required to gather and effort and equipment required to gather and process the data. process the data. Ideally, data should be Ideally, data should be gathered in the normal course of gathered in the normal course of maintenance task planning and maintenance task planning and execution execution -- and processed in a CMMS and processed in a CMMS

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Performance indicator Performance indicator implementation processimplementation process

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Performance indicator implementation processPerformance indicator implementation process

Start with situational analysis. Referencing corporate vision, mStart with situational analysis. Referencing corporate vision, mission ission and goals, list the ten biggest issues you are facing. Establishand goals, list the ten biggest issues you are facing. Establish their their underlying patterns underlying patterns –– you will undoubtedly find common causal factorsyou will undoubtedly find common causal factors

Deduce and affirm the headline lagging performance indicators Deduce and affirm the headline lagging performance indicators –– the the success factors on which the achievement of corporate goals depesuccess factors on which the achievement of corporate goals depend nd –– MTBF, MTTR, OEE, Accident FrequencyMTBF, MTTR, OEE, Accident Frequency……

For each lagging indicator, identify the associated leading indiFor each lagging indicator, identify the associated leading indicators cators and their and their best practicesbest practices

The number of leading performance indicators that could be potenThe number of leading performance indicators that could be potentially tially useful is far too large for any organisation to contemplate usinuseful is far too large for any organisation to contemplate using them g them all. Individuals would just be overwhelmed and the organisation all. Individuals would just be overwhelmed and the organisation could could become gridbecome grid--locked with informationlocked with information

ItIt’’s paramount that you home in on the most valuable indicators s paramount that you home in on the most valuable indicators –– the the Vital Few Vital Few -- those presenting the greatest threat to business those presenting the greatest threat to business performance or opportunity for improvementperformance or opportunity for improvement

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Performance indicator implementation processPerformance indicator implementation process

Apply the Pareto Principle Apply the Pareto Principle –– the 80/20 rule. the 80/20 rule. ““In any population that In any population that contributes to a common effect, a relative few of the contributocontributes to a common effect, a relative few of the contributors rs –– the the vital few vital few –– account for the bulk of the effectaccount for the bulk of the effect””

Performance indicators are tools to aid the fixing of real and pPerformance indicators are tools to aid the fixing of real and present resent problems problems –– for alleviating pain. If they do not generate the right for alleviating pain. If they do not generate the right questions, then theyquestions, then they’’re a waste of time. Collecting data which has no re a waste of time. Collecting data which has no clear connection to clear connection to dailydaily events has no value. Obscure measures are events has no value. Obscure measures are not relatable and so theynot relatable and so they’’re effectively useless. Home in on factors re effectively useless. Home in on factors that measure pain directly and are most relatable to the workforthat measure pain directly and are most relatable to the workforce, so ce, so they they ‘‘get itget it’’

Quantify the medium term goal for each indicator selected and seQuantify the medium term goal for each indicator selected and set its t its long term and immediate short term targetslong term and immediate short term targets

On the improvement journey, your initial and intermediate goals On the improvement journey, your initial and intermediate goals must must be realistic and relatable be realistic and relatable -- so they excite interest and elicit continuing so they excite interest and elicit continuing commitment commitment

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Performance indicator implementation processPerformance indicator implementation process

Strive to set goals that force your organisation to Strive to set goals that force your organisation to ‘‘stretchstretch’’ to exceed to exceed its past performance its past performance -- but donbut don’’t stretch it to the limit! While the 100% t stretch it to the limit! While the 100% perfection aim of Lean is an admirable ideal to pursue, itperfection aim of Lean is an admirable ideal to pursue, it’’s a s a practical impossibility practical impossibility -- human fallibility and frailty are constraints in human fallibility and frailty are constraints in every endeavour. A zeroevery endeavour. A zero--tolerance acceptance of subtolerance acceptance of sub--optimal optimal conditions is fine, but zeroconditions is fine, but zero--tolerance for human error can undermine tolerance for human error can undermine morale by making goals appear unattainablemorale by making goals appear unattainable

Aim for perfection and settle for excellence. When you aim for tAim for perfection and settle for excellence. When you aim for the he adequate, the result is likely to be mediocrity. This is why theadequate, the result is likely to be mediocrity. This is why the ‘‘zerozero--basedbased’’ thinking of TPM and Lean is so motivating and compellingthinking of TPM and Lean is so motivating and compelling

When a performance standard is achieved for an indicator, reset When a performance standard is achieved for an indicator, reset the the target to a higher standard. The actionable leading performance target to a higher standard. The actionable leading performance indicators will change over time in accordance with your indicators will change over time in accordance with your organisationorganisation’’s maturity and increasing sophistication of its s maturity and increasing sophistication of its management processes, so you must review them periodicallymanagement processes, so you must review them periodically

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Performance indicator implementation processPerformance indicator implementation processA performance measure should be deemphasised once the target A performance measure should be deemphasised once the target performance level has been achieved performance level has been achieved -- the organisation can then move on the organisation can then move on to realising its next goal and stepto realising its next goal and step--change initiative. Adjust necessary action change initiative. Adjust necessary action plans and select the next threats and opportunities to be addresplans and select the next threats and opportunities to be addressed in the sed in the continuous improvement processcontinuous improvement process

A precondition of A precondition of ‘‘moving onmoving on’’ is that the changed behaviours bringing about is that the changed behaviours bringing about success have become ingrained in the organisation. Without the nsuccess have become ingrained in the organisation. Without the new ew behaviours being embedded and fixed behaviours being embedded and fixed –– a permanent cultural shifta permanent cultural shift -- the the gains wongains won’’t be sustained t be sustained

Publish a tracking chart of progress at least monthly Publish a tracking chart of progress at least monthly -- provide visibility to provide visibility to whole plant. Employees often downplay and even openly ridicule twhole plant. Employees often downplay and even openly ridicule the he significance of progress whilst actually taking quiet pride in tsignificance of progress whilst actually taking quiet pride in their successheir success

Performance management is an iterative process and the overall oPerformance management is an iterative process and the overall objectives bjectives must be kept under continual reviewmust be kept under continual review

Continually reContinually re--engineer to add more value. You will never reach perfection engineer to add more value. You will never reach perfection but, for a manufacturer, the harsh reality is: but, for a manufacturer, the harsh reality is: ‘‘stop trying stop trying -- start dyingstart dying’’

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Performance improvement cycle

Act

BUSINESS PERFORMANCE PLANAssess

Review KPIs

Reset KPIs

Identify

perform

ance

elemen

ts

MAINTENANCE PERFORMANCE PLAN

Identify

Best P

ractic

e

(Ben

chmark

)Set

objectiv

es

Set KPIs

Continually assess, re-engineer and ACT to add more value…

Re-engineer

Kick off

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Particular considerationsParticular considerations•• Lean information managementLean information management

•• Human errorHuman error

•• BenchmarkingBenchmarking

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Information management and LeanInformation management and LeanLean principles apply not just to shopfloor activities but to Lean principles apply not just to shopfloor activities but to information management information management

Piling up large inventories of products is clearly poor practicePiling up large inventories of products is clearly poor practiceand the same is true for information and the same is true for information –– especially when youespecially when you’’re re piling up garbage in the mistaken belief that itpiling up garbage in the mistaken belief that it’’s valuable. You s valuable. You ignore garageignore garage--inin--garbagegarbage--out counselling at your perilout counselling at your peril

Make sure the failure and job history details you keep are Make sure the failure and job history details you keep are accurate and useable accurate and useable -- and fit for present and future purposeand fit for present and future purpose

Ensure the information you historise can be sliced and diced, soEnsure the information you historise can be sliced and diced, soitit’’s able to give up its inner secrets when you eventually get to s able to give up its inner secrets when you eventually get to query itquery it

Take care! The devil is in the detail, so make sure thereTake care! The devil is in the detail, so make sure there’’s s sufficient granularity built into your basic data to answer all sufficient granularity built into your basic data to answer all those those future questions you will undoubtedly have at some point down future questions you will undoubtedly have at some point down the roadthe road

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Human error and LeanHuman error and LeanHuman error is a huge problem in maintenance Human error is a huge problem in maintenance –– just as it is in all just as it is in all processes relying on the timely, appropriate and attentive inputprocesses relying on the timely, appropriate and attentive input of a of a human being, especially the safetyhuman being, especially the safety--critical activitiescritical activities

Human error of one sort or another is typically the cause of 80%Human error of one sort or another is typically the cause of 80% of an of an organisationorganisation’’s maintenance workload s maintenance workload –– letlet’’s face it, that does add s face it, that does add insult to injury as far as the business is concernedinsult to injury as far as the business is concerned

Human error is also the root cause of ALL of engineeringHuman error is also the root cause of ALL of engineering--related related disastersdisasters

Nevertheless, in a Lean environment, people are not viewed as thNevertheless, in a Lean environment, people are not viewed as the e problems, but as the problemproblems, but as the problem--solvers. The nosolvers. The no--blame culture does not blame culture does not mean that human error is condoned. Human fallibility is acceptedmean that human error is condoned. Human fallibility is accepted as a as a fact of life and creative strategies are encouraged and applied fact of life and creative strategies are encouraged and applied to to mitigate both its causes and effectsmitigate both its causes and effects

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Benchmarking and LeanBenchmarking and LeanLearning only from our own most current experience Learning only from our own most current experience --disregarding the lessons of history and the experience of othersdisregarding the lessons of history and the experience of others ––will result in a host of avoidable mistakes costing the organisawill result in a host of avoidable mistakes costing the organisation tion a great deal in terms of money and grief. Ita great deal in terms of money and grief. It’’s an heroic but stupid s an heroic but stupid strategy. It will never make you a winner in the 21st century strategy. It will never make you a winner in the 21st century because because winners usewinners use benchmark best practicesbenchmark best practices

Xerox, who Xerox, who ‘‘inventedinvented’’ benchmarking, define it as: benchmarking, define it as: ““the continuous the continuous process of measuring our products, services and business process of measuring our products, services and business practices against the toughest competition and those companies practices against the toughest competition and those companies recognised as industry leadersrecognised as industry leaders””

The idea is to use and build on the ideas and experience of the The idea is to use and build on the ideas and experience of the bestbest--ofof--thethe--best best –– you leverage their valuable, proven learning to you leverage their valuable, proven learning to improve your own performance. Now what could be more Lean improve your own performance. Now what could be more Lean than that? than that?

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Single points of adviceSingle points of adviceTaglines to keep in mindTaglines to keep in mind……

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Taglines to keep in mindTaglines to keep in mindJust get goingJust get going. Don. Don’’t let the pursuit of perfection overwhelm t let the pursuit of perfection overwhelm you and get in the way of becoming just a wee bit better todayyou and get in the way of becoming just a wee bit better today

Recurring problems are systems problemsRecurring problems are systems problems. Because . Because systemic problems result in a multitude of common cause systemic problems result in a multitude of common cause failures, itfailures, it’’s well worth tracking their roots well worth tracking their root--causes to ground causes to ground and dealing with them as a priorityand dealing with them as a priority

Focus on the critical fewFocus on the critical few. There. There’’s a tendency to start a new s a tendency to start a new program with too many performance indicatorsprogram with too many performance indicators

Maintain a sense of urgencyMaintain a sense of urgency. Performance management will . Performance management will not work when therenot work when there’’s lethargy. Solve todays lethargy. Solve today’’s problems today s problems today –– therethere’’ll be new ones tomorrow to add to themll be new ones tomorrow to add to them

Plan what you do and do what you planPlan what you do and do what you plan. The planning . The planning process in itself creates a virtuous spiral of continuous process in itself creates a virtuous spiral of continuous improvementimprovement

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Taglines to keep in mindTaglines to keep in mind

Repairing equipment Repairing equipment wellwell is more important than is more important than repairing equipmentrepairing equipment fastfast.. DonDon’’t shoot yourself in the foot by t shoot yourself in the foot by letting your present maintenance actions embed equipment letting your present maintenance actions embed equipment defects that will cause future failuresdefects that will cause future failures

SHE accidents precipitate substantial extra costsSHE accidents precipitate substantial extra costs. Track . Track the failures and eliminate their systemic root causes to save the failures and eliminate their systemic root causes to save the cash penalties that sap your organisation the cash penalties that sap your organisation

The devil is in the detailThe devil is in the detail. Others say God is in the detail. . Others say God is in the detail. You canYou can’’t solve problems in general, only in detail t solve problems in general, only in detail

Superficial goals lead to superficial resultsSuperficial goals lead to superficial results. Aim for the . Aim for the stars and you may hit the moon. Aim for the fence and youstars and you may hit the moon. Aim for the fence and you’’ll ll only shoot yourself in the footonly shoot yourself in the foot

If youIf you’’re not winning, youre not winning, you’’re losing.re losing. Adopt and foster a Adopt and foster a ‘‘nono--status quostatus quo’’ mindsetmindset

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Taglines to keep in mindTaglines to keep in mindImprovement is a people issue Improvement is a people issue -- itit’’s the people, stupid!s the people, stupid!You can devise the best system in the world, but when itYou can devise the best system in the world, but when it’’s not s not supported and used by the workers on the ground, itsupported and used by the workers on the ground, it’’s not s not worth the paper itworth the paper it’’s written on. Orchestrating a golden link s written on. Orchestrating a golden link between human behaviour and management systems is keybetween human behaviour and management systems is keyReject selfReject self--fulfilling prophesiesfulfilling prophesies. Never accept the . Never accept the defeatism of the naydefeatism of the nay--sayers. You can do it! Yes you can. Aim sayers. You can do it! Yes you can. Aim high, expect success and throw off the wet blankets others try high, expect success and throw off the wet blankets others try to cast to cast You get what you expectYou get what you expect. The Leader. The Leader’’s expectations set the s expectations set the tone and determine the achievement. An individual takes his tone and determine the achievement. An individual takes his reference from his Leader. As the Leaderreference from his Leader. As the Leader’’s attention and s attention and focus turns on an issue, so then do the eyes and minds of the focus turns on an issue, so then do the eyes and minds of the LeaderLeader’’s staffs staffMeasures are no substitute for leadershipMeasures are no substitute for leadership. Performance . Performance indicators, like CMMS itself, are just another tool to aid the indicators, like CMMS itself, are just another tool to aid the LeaderLeader……

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Thank you