Management and Organization Management and Organization

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Management and Organization

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Management and Organization

• Leadership

– Business Plan Fit– Vision, Mission, Policies and Objectives

– Strategic Plan

– Measurable Goals

– Resourced Action Plans

– Communication

• Organization of the M&R Function

• Implementation Process

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Leadership

• Change the way management views the role of maintenance– Cost center vs. profit center ( giving responsibility and accountability for

contributing to the overall profitability of the corporation)

– Attitudes toward maintenance are shown by the way it is treated when itcomes to dedicating resources (proper tools, proper locations, consultation onpurchasing equipment decisions, and incentives to work)

• Change how maintenance perceives its role– From repairing and maintaining ( reactive, “fire-fighting” mode) to preventing

the need for maintenance (proactive, fix-it-right-the-first-time approach); froma repair culture to asset management culture.

– Work with design engineers to “design-it-right-the-first-time”

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Maintenance as a Business Center

• Positioning Maintenance as a business center within the plant

• Recognizing and measuring impact on product quality, delivery, and plantprofitability

• Developing new measures of functional performance

• Re-organizing the maintenance function to provide accountability andresponsibility for achieving these new levels of performance

• Strategically investing in new maintenance technologies as the tools of change

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Role of Maintenance

What is the role of maintenance and reliability operations in management’spolicy and goals for manufacturing competitiveness?

Management’s policies include:

– Product quality

– Flexible manufacturing for time-based competitiveness

– Schedule stability

– Inventory and materials performance

– Overall cost leadership

– To achieve world-class maintenance if any of the above is to be world-class.

– Schonberger’s WCM consists of JIT, TQC, TPM, and EI

• In order for any of the above to be “world class,” then asset reliability mustalso be world class.

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Evolution of Expectations in Maintenance2 0 0 0

Third generation• Higher plant availability & reliability

1 9 9 0 • Greater safety• Better product quality• No damage to the environment

1 9 8 0 • Longer equipment life• Greater cost effectiveness

1 9 7 0Second generation• Higher plant availability

1 9 6 0 • Longer equipment life• Lower costs

1 9 5 0First generation• Fix it when broke

1 9 4 0

Year

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Asset environment Business Strategy

Global Objectives for PlantEngineering and Maintenance

Current Status Performance Gap Vision

Performance Drivers

Mission, Mandate

Guiding Principles

Tactics

ConceptsOrganizationArrangements

Education,Training

Systems,Procedures

Methods,Tools

MaintenanceStrategy Model

Source: Uptime, Productivity Press

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Current Status

• Assess thoroughly the strengths and weaknesses of the present system andwhich areas should head the list for improvements

• Diagnostic must be a clear roadmap of the next step to achieve the vision

• Diagnostic should cover strategic, procedural, technical, administrative, andcultural issues

• Diagnostic may be performed by an outside consultant or in-house by a self-administered questionnaire.

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Current Status• Major areas of this review are:

– business characteristics

– maintenance environment and strategy

– organization arrangements and human resource management

– maintenance administration

– planning

– scheduling and work order management

– preventive and predictive maintenance

– purchasing

– storage and inventory control

– performance measurement and customer satisfaction

– automation and information technology.

• Each response is scored and results can be plotted using a histogram or aBell-Mason type spider diagram

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010203040506070

Maintenance Self-Assessment ResultsI. Maintenance

II. Organization andAdministration

III. Work OrderSystem

IV. PM and PdM

V. PerformanceMonitoring andReporting

VI. Stores andPurchasing

VII. Cost Control

VIII. Safety &Housekeeping

IX. MaintenanceEngineering

X. Training

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20 40 60 80 10020406080100Maintenance

Strategy and Plan

Management andOrganization

ReliabilityEngineering

Maintenance andRepair

Human Resources

Integrated SupportServices

PerformanceManagement

Business Perspective

Maintenance Self-Assessment Results

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Develop the Vision

• The vision is a dream of what the company wants to be

• The intent is to develop a reliability improvement plan to move the organizationfrom the current reality to the vision

• Main goals must be based on the overall business plan

– maintenance goals should be integrated into the business plan, otherwisemaintenance improvement remains just another tactic that can be jettisoned atthe first sign of need for “cost reductions”

• Benchmarking can be used as a tool to understand what are “best practices”

• Those involved for achieving the vision should be involved in the maintenanceplan

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Closing the Gap, PlanningImplementation

Devise a plan which considers:

• The task and its key activities

• The priority of the initiative, relative to others

• Estimated resources and level of effort required

• The “champion” or person/team responsible for ensuring successful completion

• The start date, completion date, and the milestones along the way

• The goals to be achieved on successful completion, and the performancemeasures used to control progress

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Mission of the Maintenance Function

• Is a primary benchmark for effective staff decision-making

• Covers the issues of customer orientation, continuous improvement,quality, safety, environmental position, employee development,downtime, proactive stance, etc.

• Example of a mission statement:

“To maintain assets to meet customers’ needs cost effectively; tocontinuously improve skills and processes to optimize asset life, usingbest-fit models and technologies; to work safely and beenvironmentally responsible”

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Goals and Objectives

• Maximum production or availability of facilities at the lowest cost andat the highest quality and safety standards

– Maintaining existing equipment and facilities– Equipment and facilities inspections and services

– Equipment installations or alterations

Example:

Increase production capacity by:

– Reducing unplanned equipment downtime

– Reducing planned equipment downtime

– Reducing volume of off-spec production

– Increasing production speed

The goals should be shared with the operations function.

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• Identify and implement cost reductions (e.g. reduce maintenance costsby:

– Identifying/correcting machine problems before they become tooserious

– Improving maintenance troubleshooting

– Improving personnel efficiency

– Reducing maintenance parts inventory

– Identifying and replacing poor maintenance practices orprocedures

– Improving personnel skills and performance

• Provide accurate equipment maintenance records

Examples (cont.):

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• Collect necessary maintenance cost information

• Optimize maintenance resources

• Optimize capital equipment life

Example: Reduce capital expenditures by:

– Extending equipment life

– Making better repair vs. replace decisions

– Installing equipment with best cost/performance ratio

• Minimize energy usage

• Minimize inventory on hand

Examples (cont.):

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• Minimize the need for maintenance (this is an equipment engineering function,not necessarily just a maintenance function)

• Ensure the satisfactory performance of contractual maintenance services

• Improve worker safety by:

– Reducing the number of serious or critical failures

– Increasing planned maintenance (fewer emergencies)

– Improving housekeeping

• Improve the work environment though enhancement of personnel skills,technology implementation and automation of information systems

Examples (cont):

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Policies

• Essential link in guiding everyday activities to ensure consistency withthe overall concept of maintenance

• Examples of maintenance policies:– Each operations manager will ensure compliance with the policies

covering the conduct of maintenance

– Operations will be responsible for the effective utilization ofmaintenance services

– Maintenance workers will be responsible for the quality of workand the effective utilization of resources

– A work order system will be used to request and control work

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Policies

– Maintenance will publish priority-setting procedures which allows otherdepartments to communicate seriousness of work and maintenance toeffectively allocate its resources

– Performance indices will be used to evaluate short-term accomplishmentsand long-term trends

– Parts will not be removed from any unit of equipment and used to restoreanother unit to operating condition without discussion

– All maintenance personnel will be trained on maintenance techniques.Periodic evaluations will be made to ensure personnel are proficient

• Procedures are the out-growth of policy. They specify what must be done andhow to do it in order to meet policy guidelines

Examples of maintenance policies (cont.)

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Management Maintenance and Reliability (M&R) Strategy

Principles Strategy Goals Plans Resource Allocation

Operating Units

Goals Plans Resource Allocation

Results

• Reliable Equipment and Processes• Operating Cost Reduction• Maintenance Cost Reduction• Greater Productivity• Improved Safety• Less Waste Generated

Maintenance Dpt.


Engineering


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The Production/Maintenance Interface

• A great source of conflict is the problem of communication betweenthe production and maintenance functions.

• A recent European survey showed there is a controversial trendtowards a greater integration of maintenance and production control.European management favored a move toward the following structuralchanges:– Maintenance to come under the production director

– Less production personnel, but more maintenance personnel thatare also responsible for output (maintenance operators)

– Closer cooperation with production, with production moreengineering oriented.

– Common information access via computer

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Concepts of Good Maintenance

• No one unit can function in a satisfactory manner entirely on its ownan/or without the support of other units (interdependence existsbetween units of the organization).

• Ultimate responsibility for continual good condition of operatingfacilities rests squarely on the shoulders of the maintenance user andrepair service. This means that decisions on the nature, scope andvolume of work shall be made by the operating departments.

• Responsibility for cost levels of maintenance work is shared jointly bythe equipment owner (decide volume and timing) and the maintenancepersonnel (provide quality and speedy performance)

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Elements of an Effective MaintenanceProgram

1. An established planned-maintenance philosophy that is communicated,understood and reinforced. (vision, mission).

2. Formalized plan for continuous improvement with established goalsand objectives which focus on: people, equipment, material, methods.

Successful plants typically have a five-year strategic plan with definedobjectives and internal commitment to the plan: performance measuresto evaluate progress; a focus on equipment reliability; and, personnelpractices that provide recognition for exemplary performance.

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Elements of an Effective MaintenanceProgram (Cont.)

3. A site maintenance network whose task is to set expectations and monitorperformance for continual improvement and effectiveness in themaintenance function. ( Network contains representatives fromoperations, stores,central services, etc.)

4. Measurements of business results (quality, productivity, profitability,safety and environment)

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Elements of an Effective MaintenanceProgram (Cont.)

5. Measurement of overall maintenance results:

- labor productivity

- material management effectiveness

-contractor effectiveness

-planning and scheduling effectiveness

-reliability engineering effectiveness

-predictive/preventive effectiveness

-training program effectiveness

6. Commitment for increasing the involvement of all levels of the organization (task teams, operator-based maintenance, etc)

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Maintenance Organizational Structure

• Centralized maintenance: Maintenance services are managed andscheduled centrally.

– All members report to a central location for assignment

– All work requests are turned into a central area for scheduling anddispatch

– High labor force utilization

– Response time to trouble calls can be long, contributing toincreased equipment downtime

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• Area maintenance: Maintenance services are managed and scheduled by area

– Existence of small maintenance shops spread throughout the plant. Acertain number of employees are assigned to each area

– Supervisors assigned to cover one or more areas, depending on thenumber of employees

– Faster response for breakdowns, since maintenance personnel arephysically close to the equipment.

– Maintenance employees develop “equipment ownership.”

– Labor utilization can be low, allowing for more predictive work.

– If all areas have the same workload, the area concept can work

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• Combination organization: Hybrid between area and centralizedorganizational structure.

– Incorporate the best of both organizations Several small groups ofemployees are stationed near critical equipment, while keeping themain group in a centralized area.

– Emergency activities are handled quickly, while most of themaintenance personnel can be used for larger or scheduled repairjobs

– Combination organizations appear to be the way of the future.

– The concept of operator-based maintenance (TPM), whereoperators are responsible for maintenance of equipment they areassigned to operate, and use of maintenance craft workers areneeded for more complex maintenance jobs is similar to acombination organization

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Example: A microelectronics plant in the midwest of the United Statesis divided into four focused factories and 60 production cells.

The maintenance structure agreed upon by maintenance and operationmanagers was:

– Central maintenance for facility maintenance (HVAC, etc), storesinventory warehousing and control, fabrication and machine shops,tooling, information database control, and specialized tradestraining

– Focused factory maintenance for workshops, planning andscheduling, operator training in maintenance

– Cell maintenance for multi-skilled teams, urgent maintenance,preventive maintenance, free issue parts and supplies

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Advantages and Disadvantages ofDifferent Maintenance Structures

ADVANTAGES DISADVANTAGES Skills and technology Collaboration with operating

Centra l ized easily desseminated department difficult

Problems easily investigated Incomplete collection of operating data

Good communication with Difficult to share technology and skillsA r e a operating department

Speedy maintenance response Requires more people

Job rotation difficultGood communication with Management somewhat difficult

Combination operating department

Skills/technology dissemination Job rotation requires ingenuityand problem investigation possible

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Preferred Organizational Structure

• There is no correct organizational structure. When looking at structure,it is important to keep in mind the ultimate objective of themaintenance function-- to provide effective equipment at a reasonablecost.

• The manager responsible for maintenance activities should report to ashigh a level of authority as is feasible to reduce the conflict betweenproduction and maintenance.

• Maintenance stores and stores control should be the directresponsibility of the manager responsible for the maintenanceactivities.

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Internal Administrative Structure of theMaintenance Department

The maintenance department can be structured in one of the followingways:

– By trades ( mechanical, electrical, etc)– By types of service (inspection, repairs, lubrications, etc.)

– By areas of equipment

– By maintenance policy type (emergency, preventive, predictive)

The internal organization structure is often a mixture of the abovetypes.

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Maintenance Supervisor

Mechanical Electrical

Maintenance Organization in aSmall firm

Repairs andInstallations

PreventiveMaintenance

Repairs PreventiveMaintenance

Maintenance Manager

Stores Planning

ReactiveMaintenance

PM/PdM

MaintenanceInstallationsand Overhauls

ZonedAssignmentsBoiler Room

Machine ShopInspectionsLubricationsAdjustments

BuildingTrades

Mechanical Electrical Instrumentation &Control

Maintenance Organization in aMedium-sized firm

Examples ofAdministrative

Structures

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Maintenance Manager

MechanicalSupervisor

BuildingSupervisor

Planning, control & Training

ElectricalSupervisor

Stores

Reactive(Emergency

Repairs)

Inspection PowerHouse

PM/PdMMaintenance

InspectionZonedAssignments

Reactive(Emergency

Repairs)

Lubrication PM/PdMMaintenance

Instrumentation &Control Supervisor

Buildings Painting Carpentry

Maintenance Organization in a Large Firm

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M & R Implementation Process

1. Establish a M & R Assessment Team

2. Conduct a M & R Meeting3. Conduct M & R Assessment and Benchmarking

4. Maintenance and Reliability Program Planning

5. Top Management Commitment

6. Pilot Program

7. Full Implementation

8. Continuous Improvement

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EstablishVision

Operations & Maintenance

Assessment and Benchmarking

Analysis of ImprovementOpportunities

Pilot Program

Full ImplementationContinuous Improvement

Develop andTrack Key

PerformanceMetrics

TechnologyFulfillment

ProcessOptimization

ResourceOptimization

OrganizationalAlignment

Maintenance Optimization

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1. Establish an M & R Assessment Team

– Members representing site activities such as maintenance,production and support functions

– May include experts outside the organization

– Assess the current status of programs

2. Conduct a M & R Meeting

– Defines the scope, mission,vision, processes and evaluation criteria

– Creates a common vision between operations, maintenance andmanagement.

– Examines general information (facility organizational structure,financial data, etc)

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– Identifies issues

– Develops a target interview list to conduct interviews with plantpersonnel, including supplemental interviews with centralengineering and contractors. The interviews highlight theeffectiveness of the existing maintenance program, existingtechnology, existing organizational structure and managementsupport.

– Reviews maintenance records on-site

– Researches technical information

Conduct a M & R Meeting (cont.)

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Data collection

Diagnosis andsynthesis

Recommendationdevelopment

ChangeImplementation

Improved long-term effectiveness

of M&Rprocesses

Identifyissues

Conductbenchmarking

Developfindings

andconclusions

Developrecommendations

Createimplementationplans

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3. Conduct M & R Assessment and Benchmarking

– Analysis of strengths, weaknesses and opportunities within theexisting organization. Some of the elements of the analysis are:

• Plant equipment survey

• Existing Preventive/Predictive Program Review

• Technology Fulfillment

• Resource Optimization and Organizational Alignment

• Benchmarking ( gathers key performance indicators fromother industries and other companies within your industry.E.g. production costs, maintenance labor costs per unit,storeroom costs per employee, production unit downtimepercentage, etc.)

• Process optimization (work flow analysis)

• Need for and use of the CMMS within the facility

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– Develops findings and conclusions

• Assign ownership to address process improvement opportunity orissue

• Consolidate and clarify issues and best practices

• Detail process improvement opportunities, support, and desired futurestates

• Develop process improvement teams and identify other initiativeswith which to coordinate

– Develop recommendations

Based on the process improvement opportunities:

• Finalize future states

• Detail recommendations

• Estimate benefits and savings

Conduct M & R Assessment and Benchmarking (cont.)

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• Identify risks and constraints

• Identify prerequisites and associated costs

• Develop preliminary implementation steps

– Test improvement opportunities with workers, management, etc.

4. Create M & R Improvement Plans

– Estimate the payback period of each recommendation

– Detail overall implementation process and structure

– Develop preliminary implementation schedule

5. Secure top management buy-in

6. Pilot Program

– Prudent to start with a small effort and expand over time

Conduct M & R Assessment and Benchmarking (cont.)

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7. Full Implementation

– System-wide implementation

8. Continuous Improvement

– M&R optimization must be treated as a dynamic, continuous improvementprocess.

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Current Activity

Equipment Failures Prevented failures

Maintenance ProblemTypes Found

Contracted Services

PM Task Effectiveness

Tools and Instrumentation Program

Personnel andTraining

Maintenance RelatedImprovements

Customer Feedback(Internal & External

Current Activity

Program description, resources assigned,shops and laboratories, PreventiveMaintenance program, PdM program, functional organizational,administrative process description, budget and other financial resources

Unpredicted failures, prevented failures, availability factors

Problems and types identified by PdM program, problems and types identifiedby production, problems and types identified by contracted services

Description of locally made improvements; stimulus for identifying andfollowing through in improvements, root cause analysis, made or scheduled;PdM results analysis; administration of continuous improvement program

Description of services contracted out, contract relationships and howadministered, quality assurance of contracted services

Establish system selection criteria, identify PM’s not applicable or noteffective, identify PM’s with inadequate periodicity, identify overhaul PM’s toreplace with condition directed task, identify candidate PM’s for upgradeDescription of tool/instrumentation maintenance & calibration, redundancyassessment, tools adequacy and condition (the right tool for the job), PdMinstrumentation accuracy maintenancePersonnel assigned to administered programs; PdM personnel experience &training; maintenance worker job skills training; maintenance trainingprovided production/ operations staff

Maintenance self-appraisal; production appraisal of maintenance; managementappraisal of maintenance; external customer feedback; maintenance workers’appraisal of PdM teamRoutine maintenance cost-effectiveness indicators; PdM program cost savings;overall company maintenance cost effectiveness

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Good Communication is Essential!

Documents

Management and Organization Management and Organization