Total Plant Performance Management:: A Profit-Building Plan to Promote, Implement, and Maintain Optimum Performance Throughout Your Plant

Total Plant Performance Management: A Profit-Building Plan to Promote, Implement, and Maintain Optimum Performance Throughout Your Plant, by R. Keith Mobley, Keith R. Mobley

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ISBN: 0884158772

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Publisher: Elsevier Science & Technology Books

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Pub. Date: January 1999

Preface Plant performance is a dichotomy. On one hand, it is very simple. Only four factors are required for optimum performance: equipment reliability, resource utilization, employee skills, and corporate culture. At the same time, each of these factors depends on a complex interrelationship of multiple plant functions, conflicting goals, internal and external pressures, and individual personalities of corporate employees. Because of this dichotomy, improvement of total plant performance is both simple and complex. Understanding what should be done is relatively simple, but implementing changes that will achieve and sustain optimum performance is extremely difficult. The change from status quo that is required will cause trauma throughout the organization. The absolute culture change in every functional group throughout the organization will be painful, but the results more than compensate. Total Plant Performance Management is a uniquely American approach, not an adaptation of offshore practices. Its fundamental premise is that all corporate functions, from the boardroom to the shipping department, must share a common vision and effectively work together. They must become a single, focused team committed to creating a work environment that is conducive to optimum capacity, quality, safety, and profitability. This book provides a proven method of achieving continuous improvement of the total corporation, not just discrete portions of it. This approach has consistently reversed $100 million losses into $100 million in bottom-line profit. It can work for you.

VII

Table of Contents

Preface Ch. 1

Can America Compete in the World Market?

1

Ch. 2

Back to Basics

42

Ch. 3

It's Good Business

64

Ch. 4

Equipment Reliability

76

Ch. 5

Effective Organization

86

Ch. 6

Employee Involvement

104

Ch. 7

Operating Dynamics Analysis

112

Ch. 8

Train, Train, and Retrain

139

Ch. 9

Selling Continuous Improvement

160

Ch. 10

Implementation

168

Ch. 11

Maintenance Improvement

187

App

Sample TPPM Program Plan

244

Index

281

Chapter 1

Can America Compete in the World Market? American industry has lost its competitive edge. It is no longer the principal source of high-quality, low-cost products that were in such great demand after World War II. In the international market of the 1990s, offshore competitors have usurped America's role as the leader in both manufacturing technology and production capacity. As a result, America was ranked no better than fifth place as a manufacturing power in the mid-1990s. Not only have we lost the majority share of the international market, but also offshore competitors now claim a substantial percentage of our domestic market. Non-American companies now control what were traditionally American industries, such as the steel, automotive, electronics, and textile industries. The net result of this marked increase in offshore competition is a serious reduction in the demand for U.S.-manufactured goods. This reversal in our domestic market has already reached a point where it is impossible to purchase any consumer goods that are totally American made.

INDUSTRY

PERCEPTION

While America's reduced role should be abundantly clear, few of our domestic industries would admit to their responsibility for the

Total Plant Performance Management decline. Rather than admit our shortcomings, we rationalize them, using a multitude of reasons that prevent us from being competitive in the world market. Unfair offshore competition, domestic labor rates, and government restraints are cited as the main reasons for our inability to compete. Principal reasons for our failure are discussed below. UNFAIR

OFFSHORE

COMPETITION

While it is easy to blame our current state on unfair competition by Japan and other offshore competitors, they are not the root of our problems. Foreign competitors, especially Japan, are doing exactly what American industry should do. They are committed to capturing market share and to continual improvement of their competitive positions. When you consider what Japan's industry has accomplished during the past fifty years, it should be abundantly clear that its approach to business works. In less than fifty years, Japanese business leaders have taken a bombed-out country with an antiquated industrial base and turned it into the world leader in both manufacturing capability and technology. H o w did they accomplish this miraculous feat? Shekii Nakajama, author of Total Productive Maintenance and founder of the Japanese Institute for Total Productive Maintenance, stated the following at a 1996 conference in Chicago: "Following World War II, Japan adopted American management principles and manufacturing technologies, made them better, and now the world recognizes Japan's superior product quality." Is the quality of Japan's products superior to that of similar American-made products, or is it just customer perception? In the summer of 1991, a group of Chicago businesspersons ran a customer comparison of two automobiles: a Mitsubishi Eclipse and a Plymouth Laser. These two cars were placed side by side on a showroom floor, and potential customers were asked which they would prefer. Ninetyfive percent, citing superior quality as their reason, replied they would purchase the Eclipse. The results are interesting, considering that the two cars are identical. Chrysler Corporation manufactures

Can America Compete in the World Market? both, in this country. In fact, both are made on the same production line, using the same parts and assembled by the same American workers. Considering the nonscientific sample of customers used in the experiment, one could assume that some of the perceived quality advantage is the direct result of advertising rather than superior manufacturing skill. One other factor assisted Japan's mercurial rise to the top . . . its single-minded commitment to succeed. It would have been easy for Japanese industrial leaders to admit defeat and abandon any hope of rebuilding Japan into a major world power. They chose not to do so. Fifty years ago, their industrial leaders had a vision. That vision was to put the past behind them and to become the world leader in manufacturing technology and capability. For fifty years, that vision has driven their whole economy; it has been the basis for every business decision, and it has worked. AMERICAN

TRADE POLICY

In part, our inability to compete is the result of unequal marketing practices. Many foreign governments directly intervene in the policies that affect the world market. While America pursues a laissezfaire policy, other countries, such as Japan, have adopted policies that support their domestic manufacturing capabilities in the international market and limit the amount of offshore competition within their countries. In addition, many other countries provide subsidies to their domestic industries. These subsidies provide a distinctive price advantage to domestic industries on offshore products that are sold into specific foreign countries. Again, Japan is a prime example. Its government heavily subsidizes Japanese exports to America. As a result, Japanese manufacturers enjoy a distinctive, artificial price advantage over their American competitors. There is no doubt that this inequity adversely affects Americans' ability to compete in both the world and domestic markets. However, there is little that a domestic company can do to eliminate the unequal environment created by the laissez-faire policy of the United States and protectionism policies of offshore governments. Until our government makes a

Total Plant Performance Management decision to level the playing field, offshore competition will continue to have an advantage. In theory, domestic industry is protected from unfair offshore competition. Our government has negotiated trade agreements with most of the countries that export to the United States. The Voluntary Restraint Agreements (VRAs) agreed to by Japan and other countries, in theory, limit the percentage of specific domestic markets that those countries can control. Generally, this limit has been set at about 30 percent of the total domestic market for steel, automotive products, and a few other product groups. While a 30 percent market share is substantially higher than that allowed by other countries, domestic industry could absorb this level of offshore competition. Unfortunately, Japan and other offshore competitors have not been satisfied with one third of the American market. Instead, they have found the means to circumvent the VRA restrictions. One method has been to establish plants in the United States that provide final assembly or in some cases are limited to repackaging already fully assembled products. Because of the wording of the VRAs, these products are exempt from the 30 percent limit. The extent of Japan's market penetration into our domestic market is not known. However, it is substantially greater than the already high 30 percent agreed upon in our trade agreements. LABOR COSTS

The majority of corporate and plant managers will cite high labor costs as a primary reason for poor performance in the marketplace. While it is true that our domestic labor rates are higher than labor rates in some third-world countries, this is not a real barrier. Other countries, such as Germany, have labor rates that are even higher than those found in this country, but German manufacturers are able to compete against all comers in the world market. The only reason labor rates have a negative impact on your bottom line is that you are not effectively using your work force. In too many plants, the distribution of the work force is inadequate for o p t i m u m performance. These plants have relied on attrition to

Can America Compete in the World Market?

reduce head count without any thought of adequate distribution of skills and experience in key positions. As a result, overtime premiums increase, and the performance level throughout the plant declines. How do you overcome high labor rates? The simple answer is to produce more products with the existing work force. The key to competition is unit cost, not labor costs. If you can increase the output of your plant without an increase in total labor costs, you will be able to gain market share and negate the so-called high labor costs. Better utilization of the work force and increased capacity are achievable without a major investment in new capital equipment or new technology. In most plants, output can be increased by 30 to 50 percent without a capital investment. Labor rates in America are higher than those in most of the world. Except for the European Common Market countries, our labor force demands a much higher hourly rate than those paid in other manufacturing countries. Whether these high labor costs are the result of labor unions or our desire to maintain a high standard of living is of little consequence. Neither our economy nor our culture will permit a substantial reduction in established labor rates. Many of our domestic industries have attempted to resolve this negative factor by moving their manufacturing operations offshore. While this may appear to be a viable short-term solution, it creates a much more serious long-term problem. America is fast losing its revenue base. Without an active, growing manufacturing base, America cannot survive. We cannot continue to move our few remaining plants to Mexico, Taiwan, or other countries and hope to survive. The real impact of labor unions has been the gradual lowering of the work ethic of American workers. Labor unions were originally founded to protect workers from unfair management practices and to assure equitable treatment of the labor force. Over the years, this focus has shifted to an adversarial relationship between union and corporate management. Within the confines of this modern relationship, all parties suffer. The recent closing of several General Motors plants is a primary example of this adversarial relationship. When General Motors announced its plans to close its assembly plant in either Michigan or Texas, the company received two diametrically

Total Plant Performance Management different responses from the union membership of these plants. The work force in the Arlington, Tex., plant voted to work with General Motors' management to improve the overall performance and competitive position of its plant. The union membership of the Michigan plant refused to make any concessions to existing union agreements. Which plant would you retain? The constraints imposed by the Michigan plant would preclude General Motors' ability to become more competitive in the domestic car market. The willingness of the Arlington plant to work for the common good of both General Motors and its labor force would at least give the company a chance to regain market share. GOVERNMENT

INTERVENTION

Government interventions, in the form of environmental regulations, tax laws, and a variety of other factors, do prohibit domestic industries. American industry is the most regulated in the world. We must adhere to environmental policies that are much more stringent than any others in the world. With few exceptions, our industries must bear the highest corporate, inventory, and capital investment taxes in the world. Our insurance rates are without equal. MAINTENANCE

COSTS

During the past few years, there has been a dramatic shift toward maintenance improvement. In part, this is the result of a growing perception that poor maintenance effectiveness is the primary source of poor plant performance and our inability to compete in the world market. While I do not agree with this premise, there is a real need for improved performance from the maintenance organization. Maintenance is responsible for about 17 percent of the reliability problems that limit plant effectiveness. While elimination of these maintenance issues will improve overall plant performance, it is not enough to offset the high costs associated with most manufacturing and production operations. For the moment, let us assume that maintenance improvement is necessary. How do we accomplish improvement? An evaluation of

Can America Compete in the World Market? the total costs generated by a typical maintenance organization will disclose that between 50 percent and 60 percent of the total costs is made up of fixed labor costs. The annual salaries of the maintenance staff, including overhead and retirement benefits, are basically fixed costs regardless of the actual maintenance performed. The cost is the same whether or not any maintenance is performed. Without a major reduction in the work force, maintenance labor costs cannot be reduced. Should we reduce the size of our maintenance work force? In most cases, the maintenance function is already understaffed. Too many companies have relied on attrition to reduce the body count t h r o u g h o u t their organizations. Some have even offered financial incentives to encourage employees to take early retirement. In a large number of plants, these steps have been especially effective. As a result, most plants no longer have enough qualified resources to provide effective maintenance of critical plant systems. As a general statement, few plants can afford a meaningful reduction in the manning levels of their maintenance organization. Overtime premium is the only portion of the maintenance labor cost that can be easily controlled. In most plant cost-accounting systems, this is the additional labor costs, expressed in terms of equivalent manpower, generated by overtime hours. In some cases, more effective maintenance planning can reduce these costs. However, some overtime premium is also a fixed cost. For example, some labor contracts guarantee a fixed amount of overtime for all employees whether or not these extra hours are actually needed. In these instances, the overtime premium becomes a regular, fixed cost. The remaining 40 percent to 50 percent of the maintenance budget is made up of material costs. This cost classification includes all repair parts, replacement equipment, and consumables required by the maintenance department. Unlike labor costs, this category has a potential for reductions. Proper use of predictive maintenance technologies, reasonable preventive maintenance schedules, and effective maintenance planning will result in a reduction in material costs. These reductions will be the result of the elimination of unnecessary preventive maintenance tasks and the prevention of catastrophic equipment failures.

Total Plant Performance Management UNFAIR

LABOR AGREEMENTS

This rationalization is frequently cited as a major reason for poor performance. In many cases, it is used in conjunction with labor costs as the sole reasons. In some cases, there may be some truth to this limitation. Like you, I have been involved with labor agreements that absolutely prohibited effective utilization of the work force or acceptable levels of plant performance, but these have been the exception rather than the rule. In most cases, labor agreements do not restrict plant performance. Instead the real limiting factor is the enforcement of these agreements. For example, many of the continuous improvement programs stress operator involvement in daily care and maintenance of their production systems. When this topic is addressed, most plant managers will quickly respond that the labor agreement precludes this type of involvement. In most cases, this is absolutely not true. If you were to survey all the labor agreements that currently exist, you would find that the majority include daily care and maintenance of production systems in the operator's job description. Most of the perceived restrictions associated with labor agreements are not real. Instead the restrictions are the day-to-day practices that have evolved over the years. In truth, few plant or corporate managers have ever read the labor agreement. Their only perception of its contents is what they are told or what they view in the normal work environment. My best advice to plant managers is to read and understand your labor agreement. If it truly bounds your ability to work effectively, change it. Few, if any, unions will refuse to negotiate a fair and equitable agreement. After all, their membership has a vested interest in the company's survivability. WORKERS

ARE LAZY

Yes, this is a common justification for poor performance. It may not be stated in exactly these words, but some managers truly believe that American workers have lost the desire to work. I am sure every plant has a few workers who do not want to work, but these workers are a very small minority.

Can America Compete in the World Market?

I have absolute confidence in the American worker. The vast majority is made up of dedicated, hard-working employees who truly want to contribute to their companies' profitability. Why then are they perceived to be a limiting factor? A myriad of reasons exist for the apparent lack of effort or effectiveness of the work force. One of the major reasons is that American workers simply do not understand their roles. Too many plants have poorly defined job descriptions. When one evaluates plants as a precursor to implementing improvement programs, one task is to ask employees to define their roles in the plant. Few can provide clear, concise answers. These interviews should be followed up by asking their supervisors the same question. The two answers, one from the employee and one from his or her supervisor, will rarely agree. In fact, they are typically distinctly different. A second reason American employees are perceived as lazy is that workers do not have the tools needed to perform their jobs. Few workers, no matter what their positions, have the basic experience, skills, and tools required to effectively fulfill their jobs. Few plants invest in work-force development. Most plant- or corporate-level managers will strongly disagree with this statement. They will counter with annual training budget expenditures that prove it is wrong. If you evaluate the actual training provided to the work force, you will find that most of it is dedicated to mandatory training that is required by O S H A and other agencies. While these courses are important, they do nothing to improve the basic skill levels of the work force. We rarely find a plant or company that provides even a minimum level of skills-related training for its workers. American workers are frustrated more so than lazy. Over the years, they have tried to correct problems, suggest more cost-effective methods, and recommend other improvements that would benefit their companies, only to have their efforts ignored by plant management. Their work environment has compounded the frustration. They are expected to produce record quantities of prime-quality products with outdated, abused, and poorly maintained equipment. All these factors have created almost universal frustration with the direct, indirect, first-level and middle-level management labor force.

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Total Plant Performance Management

Only the senior level of management seems to have escaped the specter of frustration. CAPACITY

IS L I M I T E D

Many of the plants I have worked with during the past ten years were thought to be operating at their maximum capacity and were still not profitable. Are our plant capacities limited? Obviously, some plants are limited, but most are not. Let me share a few examples. A large snack-food producer was convinced that all its plants were operating at their absolute maximum capacity and that additional plants were needed. An in-depth analysis of these plants found they were not capacity-limited. In fact, opening a single valve could double their output. The deep-frying system relies on hot cooking oil to process the company's products. The entire frying system was designed to circulate a specific amount of cooking oil, and this circulation determined the output capacity of each system. A flow-control valve that was partially closed restricted the system. Why was it closed? The company's standard operating procedures manual clearly stated that the flow-control valve would be "positioned with six and one half threads showing." At this valve position, flow was restricted by 50 percent. This procedure had been followed for years, and no one questioned its impact on plant capacity. A n o t h e r example comes from the steel industry. To achieve acceptable levels of equipment utilization and capacity, the annual output of a bottleneck production system needed to be increased by 30 percent or about 300,000 tons. The client was convinced that this increase was impossible because the system was already operating at maximum capacity. Evaluation of the bottleneck unit disclosed that it was only being utilized 60 percent of the time. The balance, 40 percent, was allocated to planned downtime. The planned downtime included weekly maintenance outages, two multi-day major repair outages, and unscheduled downtime. The net result was a bottleneck unit that was capable of much more capacity. By eliminating some of the planned downtime and increasing the reliability of the system, the

Can America Compete in the World Market?

11

mill increased capacity by 40 percent in the first year and eliminated the production bottleneck. This relatively simple change increased annual revenue by more than $380 million. A third example, from a continuous process plant, illustrates the impact of operating practices on capacity. A critical production system was operating well below acceptable levels. The system was operating at about 50 percent capacity, product quality was poor, and total operating costs were excessive. The perceived problem was poor equipment reliability caused by improper maintenance of the system. After an evaluation, corrective actions were implemented that increased capacity by 50 percent, eliminated product quality problems, and reduced the operating costs by 30 percent. Two corrective actions were required to correct this capacity problem. First, the standard operating procedures had to be rewritten to provide best operating practices for the system. The existing procedures were inadequate and in many cases provided incorrect operating instructions. The second action was operator training. The operating crews did not know how to operate the system properly. They had abandoned the old procedures and were trying to operate the system without a clear understanding of proper methods. The combination of new procedures and operator training resolved the problem. The bottom line on the capacity issue is that most plants are nowhere near their maximum limits. In fact, most of the limitations that restrict capacity are artificial and can be resolved without any effort other than changing their business practices. The physical limit for production hours is 8,760 hours per year. Anything less is a dead loss of capacity, revenue, and profit. If your plant operates continuously, at design performance levels, for 8,760 hours each year, it is at maximum capacity. Few plants meet these criteria. Instead, the capacity is artificially limited by modifying the total available production hours to something less than 8,760 hours. Typically, the business plan will subtract all planned downtime for fluctuations in the business cycle, maintenance outages, and any other reasons that corporate planners think are reasonable. This new, reduced number of hours becomes the maximum available production hours and capacity for the plant. This practice

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Total Plant Performance Management

has been followed for so many years that many corporate- and plantlevel managers have forgotten that the extra hours exist and could be made available for production.

OTHER

FACTORS

Since World War II, America has lost sight of the factors that made it the principal manufacturing country in the world. The change has been almost imperceptible, but it is nonetheless true. We have consistently lowered our standards in all facets of life to a point that our entire culture has lost sight of the values we once cherished. Not one area of our daily life has escaped undiminished. The family unit that was at the core of America's early success has become almost as extinct as the dinosaur. Pride in workmanship and the American work ethic have undergone a radical change, and this has led to other problems.

EQUIPMENT RELIABILITY Equipment reliability is a real problem in most plants, but the perceived reasons for poor reliability are often wrong. Equipment reliability is not solely a maintenance issue, but many plants artificially limit plant performance by restricting reliability improvement programs to the traditional maintenance organization. If the efforts of these plants are successful, about 17 percent of their reliability problems will be resolved, but the remaining 83 percent will continue. Many of the equipment reliability problems can be resolved by changing the procedures and practices used to plan, operate, and mainrain the plant. The cultural issues, such as management philosophy and labor relations, are self-induced and can be resolved without major investment. It is simply a matter of changing the way you do business.

E D U C A T I O N SYSTEM The education system, like many other institutions in this country, has followed society and lowered the quality of education provided

Can America Compete in the World Market?

13

to each subsequent generation. An increasing percentage of our work force no longer has the ability to read and write. An even higher percentage does not have the ability to understand technical data written at the twelfth-grade level. At the same time that our education level is decreasing, our manufacturing processes are becoming more complex. Ten years ago, the average maintenance mechanic or machine operator had to read and understand about 500 pages of data written at the eleventh-grade level. Today that same employee, in order to properly operate or maintain critical plant systems, must read and retain more than 5,000 pages written at the college-graduate level. It should be apparent that industry must address and correct this fundamental problem before America can hope to regain its leadership role. However, few corporations invest any of their operating budgets for employee training.

M IT ANALYS

1S

The Massachusetts Institute of Technology (MIT) recently completed a two-year investigation of eight domestic industries in an effort to determine why America has lost its competitive position. These eight industries represent about 50 percent of America's total volume of imports and exports of manufactured goods and 28 percent of American manufacturing activity. The published findings describe what went wrong and suggest ways U.S. industry can get back on the path of high productivity. Weaknesses cited by the M I T commission include: o u t d a t e d strategies, short time horizons, technological weakness in development and production, neglect of human resources, failures of cooperation between individuals and between organizations, and a government and industrial base that are at cross-purposes. MIT's investigating commission on what America must do if it is to continue as a major economic power drew up the following five imperatives.

Total Plant Performance Management

14

Focus

ON EFFECTIVE

PRODUCTION

Put production ahead of finance and monetary manipulation. The report said managers who do not have a thorough knowledge of production will lose the competitive battle to those who do. CULTIVATE

A NEW

ECONOMIC

CITIZENSHIP

The work force is the only means to improve. America must develop a new work force that is involved, educated, responsible, and rewarded. These workers will maximize productivity. PROMOTE

THE

MOST

OF INDIVIDUALISM

PRODUCTIVE

BLEND

AND COOPERATION

Organizational hierarchies should be restructured into fewer job categories to promote cooperation. Adversarial relationships, such as the traditional relationships between maintenance and production, must be eliminated. LEARN

TO LIVE

IN THE WORLD

ECONOMY

We must understand other languages, cultures, and technologies. Protectionism only invites retaliation, but the United States must also insist that our goods be treated abroad as fairly as other countries' goods are treated here. PROVIDE

FOR THE FUTURE

We must invest in education and save for productive investment. Americans must be provided with a fundamentally different education from what they receive today. The report points out, "Only a tiny fraction of young Americans are technologically literate and have some knowledge of foreign societies. Unless the nation begins to remedy these inadequacies, it can make no real progress." If our domestic plant could consistently produce quality products at competitive prices, we could overcome most, if not all, of the fac-

Can America Compete in the World Market?

t5

tors that limit our market share. Unfortunately, too many companies think simple changes in organization structure or the implementation of one or more of the Japanese management concepts, such as total productive maintenance and total quality control, will provide a quick fix and reverse their positions. Unfortunately, the answer is not that simple. American industry's problems are deep-rooted and cannot be resolved by simple means. To reverse the downward spiral that is destroying our standard of living, we must eliminate all the inherent problems that have evolved within our society, government, and corporations during the past fifty years.

JAPANESE

MANAGEMENT

METHODS

There is perception, in a growing number of American corporations, that Japan is the sole reason for America's loss of market share. This perception has led many of our domestic corporations to adopt Japanese management methods as the solution for our inability to compete. Are Japanese management methods superior to our traditional methods? If we adopt these methods, will our domestic corporations regain their ability to compete? Before attempting to answer these questions, we must first understand the logic and traditions that created both the Japanese and American management methods. Major differences exist between the management methods used in Japan and the traditional methods that have evolved in this country. In many ways these methods parallel the unique requirements of our two distinctly different cultures. Because the two cultures are vastly different, the management methods that have been derived are also dramatically different. JAPANESE

CULTURE

A fundamental tenant of Japanese culture is that everyone lives within an extended family and places absolute focus on contribution to family rather than personal gain. Every man, woman, and child in Japan is raised to value his or her contribution to the family.

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Total Plant Performance Management

The extended family unit remains strong in Japan. Everyone in the society has an absolute need to belong to a strong family unit. Tradition binds each individual into a family unit. Without the family, most Japanese do not feel comfortable. As an employee, a worker in Japan absolutely believes that benefits derived by his employer~his work family~are more important than his own needs. From birth, Japanese children work diligently to prepare themselves for lifetime employment with a Japanese corporation. Conversely, the corporation is bound by tradition and culture to look after the well-being of its employees. Until recently, Japanese corporations had never terminated or laid off workers as a result of economic pressure. This single factor of the Japanese culture assures total employee involvement. In Japanese corporations, every employee is bound by tradition and culture to quality, to effective use of resources, and to continuous improvement. Because of the culture, corporations do not have to find ways to ensure cooperation between plant groups. Adversarial relationships are also nonexistent. Every employee and functional group within the plant communicates freely and cooperates with peers and with management to ensure effectiveness and continuous improvement. In Japan, the separation between worker and management is minimized. Salaries, working conditions, and benefits are fairly divided between the two groups. In addition, managers are in constant, direct contact with their work teams. The normal antagonism that exists between management and workers in America is nonexistent in Japan. Corporate philosophy is also radically different in Japan. Unlike their U.S. counterparts, most Japanese corporations base their business decisions on the long-term benefits that can be derived. For example, a Japanese corporation might decide to gain market share in a new industry by making a substantial financial investment without any return-on-investment for ten to twenty years. In part, this long-range view of business is generated by the culture in Japan. However, the methods used to finance Japanese corporations also provide unique support for the long-term approach. Many Japanese corporations are interlinked with others. This network of corpora-

Can America Compete in the World Market?

17

tions provides both the technical and financial support required for sustaining negative cash flow and short-term losses. ARE JAPANESE

MANAGEMENT

METHODS

BETTER?

Almost all the Japanese management programs, such as total productive maintenance and just-in-time manufacturing, contain valid concepts and could provide the basis for a viable management plan. However, none of these programs contains any unique methods that would provide a dramatic improvement in American corporations. As one would expect, Japanese programs focus on total employee involvement, small-group activities, and empowerment as their foundation. The heart of most of the Japanese management methods is attention to the basics. None of these programs contains any quick-fix formula for success. There is no evidence that these programs are any better or worse than those that evolved in America. WILL JAPANESE MANAGEMENT METHODS W O R K IN A M E R I C A ?

The real differences between Japanese and American corporations are not addressed in most of the Japanese management programs. All the popular Japanese management programs assume a work culture similar to that found in Japan. Therefore the programs, such as total productive maintenance and just-in-time manufacturing, do not address these critical areas. Few of us would disagree with the goals and objectives represented by most of the Japanese management programs. As an example, total productive maintenance (TPM) promotes the idea that the elimination of production losses that result from breakdowns, set-ups and adjustments, minor stoppages, reduced production rates or slowdowns, and other machine-related problems will improve the effectiveness of a maintenance organization. The concept of TPM is therefore valid, but how does one eliminate these losses? In the Japanese approach, small-group activity, a u t o n o m o u s maintenance, and empowerment will resolve all the reasons for high maintenance costs.

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Total Plant Performance Management

To a degree, these programs can be adopted for American plants. Because the programs focus on logical requirements of effective plant performance, adherence to their principles will result in improvement. However, none of these programs addresses all the needs of a typical American corporation. CONTINUOUS

IMPROVEMENT

IN A M E R I C A N

PLANTS

The basic limitations of the Japanese management programs are that they (1) are restricted to one facet of the plant, such as maintenance, (2) ignore the problems unique to American industry, and (3) assume a preconditioned work force. These factors severely limit universal implementation of these continuous improvement programs in our plants. Viable alternatives to the Japanese management programs do exist. Total productive maintenance is the best-known Japanese maintenance-improvement program. A number of domestic equivalents could be used to establish a viable continuous-improvement program. Total Productive Maintenance (TPM) This Japanese approach states that the elimination of certain types of production losses~including breakdowns, set-ups and adjustments, minor stoppages, reduced production rates or slowdowns, and other machine-related problems~will correct all problems associated with high maintenance costs. The primary measure of TPM is overall equipment effectiveness. This indicator measures the production rate, availability, and quality rate of each production system within a facility. TPM assumes that all critical equipment within the facility was properly designed and selected based on optimum life cycle costs and that all management methods are conducive to optimum effectiveness. The focus of TPM is placed on total employee involvement, autonomous maintenance, small-group activities, and preventive maintenance. Very little emphasis is placed on predictive or condition-based monitoring.

Can America Compete in the World Market?

19

A close examination of these Japanese management programs discloses many similarities and a few differences. All programs share a fundamental need for absolute adherence to sound maintenance practices. They all demand well-trained craftsmen and a corporate management philosophy that is conducive to optimum performance.

Challenges Facing American Plants As They Attempt to Improve Performance The American business environment has changed. We once based our business on quality products, but we are now driven by shortterm profit, regardless of the costs. If we are to regain our leadership role in the international community, we must regain the values, ethics, and business principles that were once uniquely American. Few in American industry will admit that our business practices and methods are at the root of our inability to compete. The minority who will acknowledge that perhaps we could be more effective and efficient cite high maintenance costs as the primary reason for poor plant performance. In truth, high maintenance cost is only the visible symptom of a much more serious problem that cannot be resolved without a complete change in the way we operate our plants. During the past fifty years, American industry has created a working environment that is no longer conducive to consistently high product quality and low production costs. In fact, we have created a working environment that prohibits our ability to compete. It has destroyed our work ethic, created artificial barriers that limit plant performance, and established the wrong measurement criteria for long-term profitability. These factors do adversely impact our competitive ability but are not the reason that America has lost its competitive edge. American industry no longer has the luxury of being the only source of manufacturing capacity capable of providing the international demand for quality goods. In today's market numerous offshore competitors can produce comparable products at lower market costs. It would appear, from all these negative factors, that our rationale is valid~we cannot compete with offshore competitors. There can be no doubt

20

Total Plant Performance Management

that the deck is stacked against our domestic industries. How can we overcome all the limiting factors that preclude our ability to win and hold market share? There are thousands of other rationalizations and justifications for poor plant performance, and we cannot address all of them in this book. However, of all the reasons we have heard, the m a j o r i t y ~ about 90 percent~are self-induced rather than caused by a physical limitation. If we would just stop shooting ourselves in the foot, many of the factors that limit plant performance would resolve themselves. Please do not misunderstand; there are hundreds of real problems that restrict plant performance, but we need to solve the artificial problems first. Resolution of the self-induced restrictions will dramatically improve plant performance and will provide the additional revenue and profit that will be needed to resolve the real problems. Where do you start? Too many companies have wasted millions of dollars on plant i m p r o v e m e n t programs w i t h o u t a measurable return-on-investment. The primary reason for these failures is that they target their perception of the problem rather than the real problems that restrict plant performance. Before you spend the first dime, evaluate your plant and define the real need. America stands at an important crossroads, and the decisions made by our manufacturing base will, to a large extent, determine what our future holds in store for our society. If manufacturers continue straight ahead and continue their current methods of plant management, America will continue to lose ground to the more progressive offshore countries. As our manufacturing base continues to decline, so will our standard of living and our entire way of life. If American industry, with support from the federal government, turns left toward total protectionism, we could protect our economics base by preventing import of offshore products. This direction would cause immediate repercussions throughout our economy. Our manufacturing base has already declined to a point that loss of offshore products would cripple our entire economy. Every one of our industries, including defense and our military services, would be unable to obtain the spare parts and replacement equipment needed to continue operation. Closer to home, we would no longer be able

Can America Compete in the World Market?

21

to purchase most of the consumer products, such as microwaves and stereos, that have become an integral part of our daily lives. Given time, American companies could fill the void and provide comparable products, but this approach would severely limit our future. The only other option available to our industrial base is to become more competitive with our offshore competitors. While the gap that separates us from our competition is great, it can be overcome.

WHAT

MUST WE DO?---TPPM IMPLEMENTATION

PROGRAM

Now that the problems facing American plants have been clearly defined, we can begin to solve them by using the TPPM program. The rest of this book will show you how to mold the different elements of your plant in such a way to improve its performance markedly. This book is intended to give you the logic and step-bystep instructions for developing, implementing, and maintaining a total plant improvement program. The methodology that will be explained is well-proven and has been successfully implemented at other plants. In every case, the program has exceeded its projected goals. (See Chapter 3 for a full discussion of typical benefits that realworld plants have derived by using TPPM.) TPPM will also work in your plant.

WHAT

DOES TPPM

REQUIRE

OF M Y P L A N T ?

Plant performance requirements are basically the same for both small and large plants. Although there are some radical differences, the fundamental requirements for both are the same, and these requirements are discussed below.

Total Plant Performance Management

22

CULTURE

CHANGE

The foremost requirement of world-class plant performance is the creation of a work environment that will encourage and sustain optimum performance levels from the entire work force. In short, we need a complete culture change that re-establishes the values that once made American industry the world leader in manufacturing technology and capability. This plant culture must start with senior management and be inherent throughout the entire work force. Without a positive work environment that encourages total employee involvement and continuous improvement, there is little chance of success. COMMITMENT

AND DISCIPLINE

As a consultant, I am asked constantly what benefits are provided by a continuous improvement program, such as predictive maintenance or total productive maintenance. Each time, I must answer truthfully that they will not provide any improvement in plant performance and therefore no savings. While this answer may surprise you, it is absolutely true. Improvement programs are simply tools and have no value until they are used properly. Too many plants attempt to implement these tools but fail to implement changes that correct poor practices, attitudes, and philosophies that are the rootcause of poor plant performance. As an example, traditional application of these c o n t i n u o u s improvement programs includes procurement of software and hardware to establish the program, authorization to assign a minimal staff to run the program, and sufficient moneys for limited training of the in-house team. The result of this approach is that these programs are implemented without any change in the work culture or plant functions that must use the benefits of the program. H o w can this approach improve plant effectiveness or generate savings? Without the absolute commitment of all parties involved in, or influenced by, the improvement program, little positive change can be expected. Commitment is a fundamental requirement of all improvement programs. Webster's Dictionary provides two definitions of commit-

Can America Compete in the World Market?

23

ment that are pertinent to continuous improvement programs. The first defines commitment as an "agreement or pledge to do something in the future." Senior management must be absolutely committed to full implementation of all the tasks required to establish, fully utilize, and sustain a continuous improvement program, such as predictive maintenance. This commitment cannot be limited. It must include a total, absolute culture change throughout the plant. Without this total commitment, nothing will change. Nothing can be done to improve operating and maintenance practices or to enact the myriad of other changes required to overcome poor plant or corporate performance. The second definition is the "state of being obligated or emotionally impelled." The entire work force must make a total commitment to support the program and its culture changes before improvement can be achieved and sustained. The work force's commitment cannot be mandated, but positive senior-management leadership is a mandatory factor. The obligation must start with senior management and be adopted by the entire work force universally. The entire work force must embrace change and fully s u p p o r t the c o n t i n u o u s improvement effort. The entire work force, from the CEO to the floor sweeper, must believe in and be committed absolutely to the changes essential for effective plant performance. Commitment is not the only factor that must be included in a successful improvement program. The second keystone is discipline. There are two pertinent definitions of discipline: "control gained by enforcing obedience or order" and "orderly or prescribed conduct or pattern of behavior." Both definitions have a vital role in continuous improvement. First, management must establish and enforce the procedures and practices required to gain maximum effectiveness from plant functions. Too many plants establish procurement, operations, and maintenance procedures that could provide effective performance of these critical plant functions, but these plants fail to be effective. The missing factor is a lack of discipline. Management failed to enforce policies, procedures, and work habits for so long that those actual operating practices have degraded to a point that p r o d u c t quality,

24

Total Plant PerformanceManagement

capacity, and costs are totally unacceptable. This absence of enforced discipline is one of the leading causes of poor plant performance. The second definition of discipline must be adopted by the entire work force. Each and every employee must have the self-discipline to work effectively and to constantly seek improvement in his or her position. The work procedures and practices must be followed, and every job or task completed fully. Behavioral change does not just happen instantly, but positive reinforcement from management eventually achieves the work culture change that is a fundamental requirement of effective performance. EQUIPMENT RELIABILITY

Equipment reliability is the fundamental requirement of optimum plant performance. Without reliable manufacturing and process systems, nothing else matters. Product quality, production capacity, and profitability all hinge on this one critical factor. Please see Chapter 4 for a full discussion about this subject. Reliability E n g i n e e r i n g Most plants do not have a formal reliability-engineering function, nor do they have programs that directly address reliability problems. In a few instances, product-quality and maintenance-management programs acknowledge equipment reliability as an issue. However, these programs do not include specific programs that will improve reliability. In part, this omission is created by our inability to assign responsibility for equipment reliability. Maintenance has an important role; but so do production, plant engineering, purchasing, sales, and training. Each of these plant functions has a direct impact on performance. Poor maintenance practices are perceived as the dominant factor that limits production capacity, product quality, and profitability. In some cases, this perception is valid; but many of the reliability problems adversely impacting plant performance cannot be attributed to poor maintenance. Many of the perceived maintenance problems are

Can America Compete in the World Market?

25

really outside the maintenance function. Improper operating procedures, poor design, and improper scheduling of production are the real sources of many plant reliability problems. These plant functions must also assume an active role in equipment reliability. Equipment dependability begins with the specification and selection process. The plant engineering and purchasing functions must actively pursue reliability as part of the process. Life cycle cost, maintainability, and employee skill requirements must be key factors in the decision-making process. The purchase prices of new and replacement systems are not a true measure of equipment cost or its impact on overall plant performance. Purchasing must also use good judgment when selecting replacement components for both maintenance and production. Too many plants select vendors and components solely based on costs. Little or no consideration is given to a component's life cycle cost or its impact on equipment reliability. As an example, one client elected to purchase a light duty bearing for critical foundry exhaust fans from a particular vendor because the purchase price was five dollars less for each bearing than another vendor's price. As a result of this decision, the mean-time-between-failure of these fans was reduced from six years to six months. Purchasing must assume an active role in equipment reliability. Without this function's support and active participation, acceptable plant performance levels cannot be achieved. Production has the greatest role to play. For every maintenancerelated problem, fifty problems are generated by poor operating procedures and methods. Operator error is an obvious cause of equipment downtime and product quality problems. However, production's contribution to poor performance is much greater. One example of this was secured during an evaluation of a cold reduction mill for an integrated steel mill client. My task was to improve the overall performance of this complex production system. Eighty percent of the problems that restricted the system's capacity, product quality, and costs was directly attributable to poor operating procedures and practices. Most of the problems were easy to correct, and none required a financial investment.

26

Total Plant Performance Management

Sales and marketing also directly impact equipment reliability. The sales function determines how most plants are operated. In some discrete manufacturing plants, this does not present a serious problem. However, in continuous process plants, such as steel and paper mills, sales can have a serious, negative impact on plant performance. If the sales function loads a plant with short-run, low-quantity orders, the number and frequency of machine set-ups will increase. This constant stopping, set-up changing, and restarting has a direct impact on reliability, product quality, and capacity. Historically, a high percentage of product rejects and lost capacity can be directly attributed to set-up changes. Rejects increase as the system is stopped. Improper set-up often creates a marked increase in rejects as the line is restarted. Coupled with the time lost to the change of product, these short-run orders are a major contributor to poor plant performance. Higher levels of performance, including reliability, can be achieved when plant equipment can be allowed to run without constant starts and stops. Employee skills are also a critical part of equipment reliability. Operators and maintenance personnel must have adequate knowledge of proper procedures before an acceptable level of performance can be achieved. The training function must accept its role in supporting equipment reliability. Without its support, acceptable skill levels cannot be achieved. Standard procedures, both operation and maintenance, also contribute to poor reliability. In most cases, standard operating procedures and standard maintenance procedures do not provide enough data to properly operate or maintain plant equipment. These shortcomings are too often viewed as employee failures. Management assumes that the work force lacks the skills or motivation to perform its duties. In many cases, the failure is in the procedures and not the employees. Who is responsible for equipment reliability? The answer is both simple and complex. Everyone must take an active role. A viable reliability improvement program must start with corporate management, which must establish and support policies that create an environment conducive to maximum utilization of manufacturing and process systems. Without management's active support, improve-

Can America Compete in the World Market?

27

ment is difficult tO achieve. Unfortunately, lack of corporate leadership and support is the norm and is a major reason for poor equipment reliability. Plant engineering, purchasing, production, maintenance, and training are the critical functions. Life cycle cost, ease of maintenance, and reliability must become their primary focus. They must work together with a common objective . . . to achieve the best performance from all plant equipment and systems. If you can improve the reliability of your equipment, then product quality, increased capacity, and profitability will follow. I N T E G R A T I O N OF P L A N T F U N C T I O N S

Regardless of the product or production type, all plants are integrated. Each of the functional groups, such as purchasing, maintenance, and production, depend on other functions. Without an integrated, coordinated effort of all functional groups, reasonable levels of performance cannot be achieved. The premise of a viable continuous improvement program must be that maximum plant performance is dependent on the integration of all critical functions within a plant. Plant engineering, purchasing, and other plant functions have a direct impact on equipment reliability, availability, and total operating costs as do maintenance and production. Each of the critical functions must work in conjunction with both production and maintenance before measurable plant improvement can be achieved. Optimum performance of critical plant production systems is also dependent on the integrated efforts of these critical plant functions. Many of the factors that adversely affect product quality, production capacity, and total operating costs can be directly attributed to failures in the design, purchasing, or installation of critical manufacturing systems. Total Plant Performance Management (TPPM) will establish design, purchase, and installation criteria that will assure optimum performance levels from all plant systems for their full useful lives. The methodology, based on life cycle costs, will provide standard procedures and equipment evaluation methods that will eliminate limiting factors before they enter the plant.

28

Total Plant Performance Management

Sales a n d M a r k e t i n g To achieve integration of plant functions in the TPPM program, the sales and marketing group first must provide a volume of new business that can sustain acceptable levels of production performance. Equipment utilization cannot be achieved without a backlog that permits full use of the manufacturing, production, or process systems. However, volume is not the only criterion that must be satisfied by the sales and marketing group. It must also provide a product mix that permits effective use of the production process, order size that limits the number and frequency of set-ups, delivery schedules that permit effective scheduling of the process, and a sales price that provides a reasonable profit. The final requirement of the sales group is an accurate production forecast that will permit long-range production and maintenance planning. Production Production management is the second step toward acceptable plant performance under TPPM. The production department must plan and schedule the production process to gain maximum use of its processes. Proper planning depends on a number of factors: good communication with the sales and marketing group; knowledge of unit production capabilities; adequate material control; and good equipment reliability. Production planning and effective use of production resources is also dependent on coordination with (1) procurement, (2) human resources, and (3) maintenance functions within the plant. Unless these functions provide direct, coordinated support, the production planning function cannot achieve acceptable levels of performance from the plant. In addition, the production department must execute the production plan effectively. Good operating procedures and practices are essential. Every manufacturing and production function must have, and use, standard operating procedures that support effective use of the production systems. These procedures must be constantly evaluated and upgraded to ensure proper use of critical plant equipment.

Can America Compete in the World Market?

29

Procurement Third, the procurement function must provide raw materials, production spares, and other consumables at the proper times to support effective production. In addition, these commodities must be of suitable quality and functionality to permit effective use of the process systems and finished product quality. The procurement function is critical to good performance of both the production and maintenance functions. This group must coordinate its activities with both functions and provide acceptable levels of performance. In addition, procurement must implement and maintain standard procedures and practices that ensure optimum support for both the production and maintenance functions. As a minimum, these procedures should include vendor qualification, procurement specifications based on life cycle costs, incoming inspection, inventory control, and material control.

Maintenance Fourth, the maintenance function must ensure that all production and manufacturing equipment is in optimum operating condition. The normal practice of quick response to failures must be replaced with maintenance practices that will sustain optimum operating condition of all plant systems. It is not enough to have production systems operate. The equipment must reliably operate at or above nameplate capacity without creating abnormal levels of product quality problems, preventive maintenance downtime, or delays. Maintenance prevention should be the objective, not quick fixes of breakdowns. Maintenance planning and scheduling is an essential part of effective maintenance. Planners must develop and implement both preventive and corrective maintenance tasks that achieve maximum use of maintenance resources and the production capacity of plant systems. Good planning is not an option; it is a necessity. Plants should adequately plan all maintenance activities, not just those performed during maintenance outages.

3o

Total Plant Performance Management

Standard procedures and practices are essential for effective use of maintenance resources. The practices should ensure proper interval of inspection, adjustment, or repair. In addition, these should ensure that each task is properly completed. Standard mainentance procedures (SMPs) should be written so that any qualified craftsman can successfully complete the task in the minimum required time and at minimum cost. Adherence to SMPs is also essential. Members of the work force must have the training and skills required to effectively complete their assigned duties. In addition, maintenance management must ensure that all maintenance employees follow standard practices and fully support continuous improvement. Other Plant Functions Finally, in medium and large plants, there are other plant functions that play a key role in plant performance. Smaller plants either do not have these functions, or they are combined within either the production or maintenance functions. These functions include human resources, plant engineering, labor relations, cost accounting, and environmental control. Each of these functions must coordinate its activities with sales, production, and maintenance to ensure acceptable levels of plant performance. INFORMATION

MANAGEMENT

Effective use of plant resources is absolutely dependent on good management decisions. Therefore, viable information management is critical to good plant performance. All plants have an absolute requirement for a system that collects, compiles, and interprets data that define the effectiveness of all critical plant functions. This system must be capable of providing timely, accurate performance indices that can be used to plan, schedule, and manage the plant. A viable information management system is an essential part of all plant improvement programs. One of the generic limitations of domestic plants is the lack of timely, useful management information.

Can America Compete in the World Market?

31

Few plants have the means to gather, compile, and interpret a minimum level of management information. Too many generate mountains of information that is totally useless as a management tool. This program, depending on plant size, may be a relatively simple manual system designed to track the key indices of plant performance. However, the volume of data required in larger plants may dictate the use of a computer-based program. Great care should be taken during the definition of program requirements and system selection. Errors at this point will have serious implications as the program develops. RESOURCE UTILIZATION

Generally, domestic plants are not effectively using their resources. This is true of both their capital equipment and their work force. Resource utilization must be addressed before any measurable improvement is achieved.

Equipment Utilization First-time-through production capacity is the prerequisite measurement of plant performance. Therefore, it is essential that full utilization of all installed capital equipment is the first step in any continuous improvement program. Few corporate managers have an accurate assessment of their true equipment utilization. In part, this is the result of faulty information management methods. In most corporations, information is badly fragmented or compartmentalized to a point that a true measure of any performance indicator, including equipment utilization, is difficult or impossible to determine.

Labor-power Utilization Downsizing or re-engineering of the work force has radically changed the demographics in many plants. Most have relied on early or induced retirement to reduce the number of hourly and salaried

32

Total Plant Performance Management

workers in their companies. The net result of these changes is a work force that is often mismatched to the actual needs of the plant. Any attempt to improve overall plant performance must include a program that will ensure the right population of skilled workers to meet the demands of each functional group within the corporation. When the demographics are correct, the next step is to ensure maximum utilization of the work force. When you consider that a typical maintenance craftsperson spends less than 25 percent of the workday on maintenance tasks, it is apparent improvement is an absolute necessity. The same manpower utilization percentage is true for most of the work force. Time lost through inefficiency, excessive meetings, and poor planning must be eliminated before measurable benefits can be achieved. Planning Functions Too few plants have adequate planning functions. In many plants, crisis management is a way of life, and little, if any, formal planning is done on a routine basis. This task must identify and implement formal planning functions within all critical plant functional areas. Specific attention should be given to the maintenance function. SKILLED~ MOTIVATED WORK FORCE

Perhaps the most important resource in a corporation is its work force. Without people to plan, manage, operate, and repair, the investment in capital equipment is of little value. Skills T r a i n i n g P r o g r a m Training is also a vital part of the TPPM program. Within the program's framework are the means to identify specific training requirements for all critical plant functions and to start a continuous education program for all employees. The training effort will provide the practical operator, maintenance, planning, and management skills required to achieve optimum performance from the total plant. The

Can America Compete in the World Market?

33

steps required to begin the needed change will include implementation of global programs for all functional groups and employees within the corporation. This is why it is important that all companies improve the employee skill level throughout their plants. Employee Involvement A fundamental requirement of this or any other plant improvement program is total involvement of all employees within the plant. Care must be taken to ensure that every last employee understands the rationale behind the program and his or her role in the survival of the plant. Without absolute involvement and total commitment of each and every employee, the program will not be completely successful.

IMPLEMENTING

CONTINUOUS

IMPROVEMENT

Return-on-investment must be a critical part of any continuous improvement program. Few, if any, of our domestic plants can afford nonessential costs without an immediate improvement that will at least offset them. Each individual T P P M p r o g r a m should be designed to focus its initial efforts on those areas that will create the greatest short-term improvement in bottom-line profits. In addition, the program must provide the means, based on return-on-investment, to assure continual long-term improvement of the total plant. Neither Total Plant Performance Management nor any other continuous improvement program is a quick fix. While the total plant approach will generate substantial immediate improvement, TPPM is designed to provide continual improvement during the entire lifetime of the plant. Complex problems cannot be resolved with simple solutions. For many companies, implementing any form of continuous improvement program, especially this holistic approach, will be traumatic. However, a successful program must displace all the bad habits that have developed over the years and remove all our alibis for poor performance. The results generated by the implementation

34

Total Plant Performance Management

of a Total Plant Performance Management program will quickly offset all the anguish and hard work associated with its implementation. SMALL

PLANTS

All plants must adhere to the basics this book will discuss, but small plants face unique constraints. Their size precludes substantial investments in manpower, tools, and training that are essential to effective asset management or to support continuous improvement. Many small plants are caught in a Catch-22. They are too small to support effective planning or to implement many of the tools, such as predictive maintenance and computer-based maintenance management system (CMMS), that are required to improve performance levels. At the same time, they must improve to survive. In addition, the r e t u r n - o n - i n v e s t m e n t generated by traditional continuous improvement programs is generally insufficient to warrant implementation of these programs. Predictive maintenance, preventing problems before they happen, is a classic example of this Catch-22. Because of their size, many small plants cannot justify implementation of predictive maintenance. While the program will generate similar improvements to those achieved in larger plants, the change in actual financial improvement may not justify the initial and recurring costs associated with this tool. For example, a 1 percent improvement in equipment availability in a large plant may represent an improvement of $1 million to $100 million. The same improvement in a small plant may be $1,000 to $10,000. Large plants can afford to invest the money and manpower required for achieving these goals. In small plants, the cost required to establish and maintain the predictive program may exceed the total gain. The same Catch-22 prohibits formal planning, procurement, and training programs in many of the smaller plants. The perception is that the addition of nonrevenue-generating personnel to provide these functions would prohibit acceptable levels of financial performance. In other words, the bottom line would suffer. To a point,

Can America Compete in the World Market?

35

this may be true, but few plants can afford not to include the same essentials of plant performance as a larger plant. In many ways, small plants have a more difficult challenge than larger plants. However, with proper planning and implementation, small plants can improve their performance and gain enough additional market shares to ensure both survival and long-term positive growth. They must exercise extreme caution and base their longrange plans on realistic goals. Some plants attempt to implement continuous improvement programs that include too many tools. They assume that full, in-house implementation of predictive maintenance, CMMS, and other continuous improvement tools are essential requirements of continuous improvement. This is not true. Small plants can implement a continuous improvement program that will achieve the increased performance levels needed without major investments. Judicious use of continuous improvement tools, including outside support and modification of in-house organizations, will permit dramatic improvement without being offset by increased costs. Continuous improvement tools, such as CMMS and information management systems, are available for small plants. These systems are specifically designed for this application and provide all the functionality required to improve performance, without the high costs of larger, more complex systems. The key to successful implementation of these tools is automation. Small plants cannot afford to add personnel whose sole function is to maintain continuous improvement systems or programs. Therefore, these tools must provide the data required for improving plant effectiveness without additional personnel. LARGE PLANTS

Because of the benefits generated by continuous improvement programs, large plants can justify implementation. However, this should not be used as justification for implementing expensive or excessive programs. A typical tendency is to implement multiple improvement programs, such as total productive maintenance, just-in-time manufacturing, and total quality control, that are often redundant or conflict

Total Plant Performance Management

36

with each other. Frankly, there is no justification for this shotgun approach. Each of these programs adds an overhead of personnel whose sole function is program management. This increase in indirect (nonrevenue-producing) personnel cannot be justified. Continuous improvement should be limited to a single, holistic program that integrates all the plant functions into a focused, unified effort. Large plants must exercise more discipline than their smaller counterparts. Because of their size, the responsibilities and coordination of all plant functions must be clearly defined. Planning and scheduling must be formalized, and communication within and between functions is much more difficult. An integrated, computer-based information management system is an absolute requirement in larger plants. As a minimum, this system should include cost accounting, sales, production planning, maintenance planning, procurement, inventory control, and environmental compliance data. These data should be universally available for each plan function and configured to provide accurate, timely management and planning data. Properly implemented, this system will also provide a means to effectively communicate between and coordinate the integrated functions, such as sales, production, maintenance, and procurement, into an effective unit. Large plants must also exercise caution. The tendency is to become excessive when implementing continuous improvement programs. Features are added to the information management system and predictive maintenance program, which are not needed by the continuous improvement program. For example, one plant added the ability to include video clips to their CMMS system. While this added feature may have been of some value, it was not worth the $12 million in additional costs. YOUR

PLANT

Continuous improvement is an absolute requirement in all plants, but these programs must be implemented in a logical manner. Your program must be designed for the unique requirements of your plant. It should be designed to minimize the costs required to imple-

Can America Compete in the World Market?

37

ment and maintain the program and to achieve the best return-oninvestment. In my thirty years as a manager and consultant, I have not found a single plant that would not benefit from a continuous improvement program. However, I have seen thousands of plants that failed in their attempts to improve. Most of these failures were the result of restricting the program to a single function or of inflated costs generated by the addition of unnecessary tools. These types of failures are preventable. If you approach continuous improvement in a logical, plant-specific manner, you can be successful regardless of plant size. Total Plant Performance Management is a plant management program developed to address the myriad of unique problems that face our domestic industries. The concept provides the means to methodically identify, quantify, and eliminate all the factors that limit total plant performance and to generate immediate return-on-investment. This approach integrates all critical plant functions into a single, focused management plan committed to continuous improvement of product quality, production capacity, employee safety, and profitability.

WHERE

TO START

The first step in solving any problem is to clearly define the problem within a specific plant. The same is true of continuous improvement. Before embarking on a total plant program, you must first gain a clear understanding of the strengths and weaknesses within the corporation. BENCHMARK

PLANT STATUS

The first step required to implement a TPPM program must be an honest, detailed evaluation of plant status and an accurate identification of all factors that limit plant performance. In many cases, this is the most difficult part of the program. This evaluation must break through your preconceived perceptions of the plant and its limitations. The success of your program is absolutely dependent on the

Total Plant PerformanceManagement

38

data developed as part of this evaluation. Each limiting factor must be well-defined, and its impact on the plant quantified. The benchmark analysis or plant evaluation should include all true indices of plant performance. DEVELOP

A DETAILED

PLAN

With the data developed in the plant evaluation, a detailed program plan must be developed that will provide the focus and direction needed for the initial phases of the plant improvement program and its long-term goals and objectives. The initial program plan must contain enough detail to define the following: the first active phase, specific short-term objectives, methods for the elimination of selected limiting factors, manpower requirements, capital equipment costs, a milestone schedule, and projected short-term return-on-investment. In addition, the initial program plan should include schedule and task assignments for periodic upgrade of the program plan. The remaining phases of the program will vary depending on the limiting factors defined in the first step. However, all programs will require the implementation of critical global functions and methods, as detailed in the remainder of this chapter. AVOID

FAILURE

Many factors determine the success or failure of continuous improvement programs. Some of these are real, and some are selfimposed. In the former category are restrictions imposed by plant cultures, management philosophies, and our natural resistance to change. In the latter are those restrictions caused by our failure to properly plan and implement improvement programs. The more common factors that limit success include (1) having too many programs, (2) program limitations, (3) use of consultants, and (4) plant culture.

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39

Too M a n y P r o g r a m s Most of the continuous improvement programs, such as total productive maintenance (TPM) and reliability-centered maintenance (RCM), have a relatively narrow focus. As a result, they cannot address all the problems and issues that affect plant performance. To compensate for these limitations, many plants attempt to implement multiple programs in parallel. I have seen cases where plants have seven or more continuous improvement programs in progress at the same time. Because each of these programs requires a dedicated staff to manage the effort, the drain on plant personnel can become a seriously limiting factor. There have been numerous cases in which the manpower drain caused by multiple programs limited production capacity of the plant. While similarities exist among many of these continuous improvement programs, there are also distinct differences. For example, both total productive maintenance and reliability-centered maintenance stress equipment reliability. However, their approaches are radically different. The TPM approach stresses the basics of design, procurement, and maintenance as the best way to assure reliability. RCM focuses on failure modes and effects analysis and other evaluation techniques. As a result, multiple programs, such as the ones mentioned, tend to cause serious conflicts within the plant. Employees receive mixed, often diametrically opposed, direction from this approach to continuous improvement.

Program Limitations The primary reasons plants attempt to implement multiple programs is the programs' narrow focus and inability to address all the factors that limit plant performance. Few, if any, of the more popular continuous improvement programs address all the needs of a typical plant. For example, predictive maintenance, total productive maintenance, and reliability-centered maintenance are all restricted to the traditional maintenance organization. Because only 17 percent of the factors that contribute to equipment reliability problems arc maintenance-related,

40

Total Plant Performance Management

programs that are limited to a single plant function or problem cannot support total reliability improvement. Other continuous improvement programs share this type of limitation. Most are limited to one specific plant area or to one type of improvement effort. Use of Consultants Most plants do not have the in-house expertise required to select and implement continuous improvement programs. As a result, they are forced to seek the help of outside consultants. If they select a competent consultant, the potential for success is greatly improved. Unfortunately, this does not always happen. A number of competent consultants have the practical knowledge and expertise needed to ensure successful implementation of continuous improvement programs. But a growing number of unqualified consultants also tout their ability to help implement programs. The challenge for plant personnel is to tell the difference between them. Both talk a good game, but only the competent consultant has the skills required to lead you through the myriad of tasks required to implement and institutionalize your improvement program. Two failure modes are common. In one instance, the consultant's advice is followed absolutely and without question. In the other, the consultant's advice is ignored, and the program is implemented to support status quo in the plant. Both of these approaches lead to failure. If a competent consultant is used, his or her advice should be followed. I have never understood why plant management would hire an expensive consultant and then elect not to follow his or her advice. I would not suggest blind obedience, but the consultant was hired because he or she is the expert. If you are not going to use the advice, why pay the sometimes excessive consulting fees? The converse is also true. Plant management may follow the advice of a consultant (or consulting firm) without questioning the validity of his or her approach. If the consultant or consulting team is competent, this approach will usually succeed. However, the advice of an unqualified consultant will lead to absolute failure.

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41

Plant Culture Few of the more popular continuous improvement programs address the need to change plant culture. As a result, the fundamental status quo of the plant or corporation is unchanged by the continuous improvement program. Granted, it's not easy to convince senior management or the board of directors that it must change, but anything short of a total change will limit plant performance. Without an absolute, total culture change, continuous improvement is not possible. The limitations imposed by corporate policy, management philosophy, and the day-to-day management methods preclude effective resource utilization. Unless these limitations are removed, the functional groups, such as planning, cannot achieve and sustain optimum plant performance.

CONCLUSION Now that we've looked at the problems facing American plants and touched on how TPPM can provide solutions, let's go over some basic ideas and premises that will play a role in implementing this program.

Chapter 2

Back to Basics

Good plans always take time to start from square one. This chapter will get your plant moving toward optimum performance by outlining a few fundamental premises of the TPPM Program.

THERE

ARE NO SILVER

BULLETS

The reaction of American industry to the challenges presented by its loss of market share has varied from doing nothing to wholesale reorganization. Few industries, if any, have addressed the problems adequately. The general reaction of our domestic industries has been to either adopt one or more of the Japanese management programs, such as total productive maintenance and just-in-time manufacturing, or to enter into joint ventures with their offshore competitors. None of these approaches has proven completely successful. The near panic caused by the American industry's loss of its leadership role and shrinking profits has created a booming market for quick-fix programs that reportedly will resolve our chronic quality, manufacturing, or profitability problems. Each of these programs shares common traits. All are advertised as having the ability to immediately resolve all our problems without costing the plant any additional money or effort. In addition, these programs assume that 42

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a generic program can resolve the unique problems of any plant. Each of these programs focuses on a specific area of perceived problems, such as quality or high maintenance costs, and ignores the multitude of other factors that directly affect plant performance. While they all share some principles, many of their concepts or methods may be detrimental to total plant performance. For example, total concentration on product quality improvement, using the concepts in some of these programs, would force a reduction in production capacity or would increase maintenance c o s t s ~ b o t h of which have a serious, negative impact on bottom-line profits. Another limitation of quick-fix approaches is that none of these programs addresses the total plant need. Therefore plants must implement multiple programs to resolve existing problems, which results in two things. First, the labor-power and time required to manage multiple programs severely impacts the plant improvement effort. In many cases, more time is spent on program management than is spent on improving plant performance. The second problem is loss of focus. It is difficult, if not impossible, to coordinate and maintain continuity when multiple programs are implemented at the same time. The confusion that often results from conflicts or contradictions between the various programs severely detracts from their combined objectives. Unlike Japan's relatively new, well-designed plants, most of our plants are old, poorly designed, and have not been properly operated or maintained. Our management methods and business philosophies are outdated; our work ethic has degraded, and we have lost touch with the values that once made America the world's manufacturing leader. The problems that face our domestic plants cannot be resolved by simplistic corrective actions. Reorganization or the adoption of a quick-fix management program simply will not compensate for the multitude of problems that exist in our factories. To regain our competitive position in the world market, American industry must do the following things: recognize the true extent of its problems; admit that Americans' own failures as citizens, businessmen, and government officials are the root-cause of these problems; and then roll up

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its sleeves and correct each of these limitations. These tasks will not be easy, nor can they be accomplished overnight. It has taken years of complacency to create the problems, and it will take years of hard work and the combined efforts of the entire work force to completely resolve them. As Americans, we are a unique breed. We are born optimists, and we always look for an easy way to solve our problems. For some reason, we have an aversion to rolling up our sleeves and expending the effort required to achieve our goals. Instead, we procrastinate until a method that has the perception of being easy and painless miraculously appears. We never have time to do something right the first time, but we always find time to do it over and over again. We put off difficult or unpleasant problems and tasks, hoping they will solve themselves or simply go away. In addition, we have an excuse that justifies our inability to accomplish any goal or achieve any performance level. In business, we blame unfair offshore competition, government restrictions, labor agreements, and a myriad of other reasons that prohibit our ability to compete in the world market. This character flaw seems to control everything we do in both our personal and business lives. American society and industry are faced with serious problems. These problems are b o t h difficult and unpleasant but must be resolved. Our only hope of continuation as a viable society and country depends on it. Instead, we continue to wait for a silver bullet that magically solves our problems. I hate to be the bearer of bad news, but there are no silver bullets! There are no simple solutions to the problems that face our domestic industries. As we discussed in Chapter 1, our problems will not be solved by simply adopting management methods that have worked for the Japanese. In addition, the problems that limit our performance are much more severe and radically different than those in Japan. Over time, our work ethic and plant cultures have degraded to a point that radical change is needed. For example, our business focus is strictly short term. Every action within the plant is driven by immediate return-on-investment and quarterly profit margins. In Japan and

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other progressive countries, a broader view is taken. These plants may sacrifice short-term profits for the greater, long-term return. There are many other reasons why strict adoption of offshore management practices has limited success in our domestic plants, but simply stated, this is not a viable solution to our problems. These limitations expand to include the "cookbook" used for any continuous improvement program. In addition to Japanese management programs, American industry has attempted to implement packaged programs, such as reliabilitycentered maintenance, computers-in-manufacturing, and a multitude of other programs. In most cases, these programs have been implemented without any regard to the unique problems in each plant. Further, this omission is the dominant reason that these programs have failed. In my thirty years of solving plant performance problems, I have never found two plants or corporations that had exactly the same problems. Every plant is unique, and so are their problems. As a result, a cookbook solution has little or no possibility of solving those problems. Continuous improvement must be directed at the specific limiting factors of a specific plant or corporation. While it is possible to use parts of these formula approaches, carte blanche implementation has little chance of success. Total Plant Performance Management is not a quick-fix solution. Instead, it is a plant-specific improvement program configured to improve the effectiveness of the total plant. Rather than addressing one part of the plant, such as maintenance, it integrates all critical functions within the plant into a single, focused effort committed to continual improvement of the entire plant. In most cases, high maintenance costs, chronic product-quality problems, or constant late delivery of goods are symptoms of more serious problems within the plant. These problems span the entire corporate organization, not just a few individuals, groups, or plant areas. Therefore, limiting improvement programs to just one area of the plant, such as maintenance or manufacturing, cannot resolve all the inherent problems that limit plant productivity.

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SELF-DISCIPLINE Change is never easy. Implementing the radical changes required to optimize plant and corporate performance is no exception. Each member of the plant team must have the willpower and discipline to change from his or her normal methods to those established as part of the continuous improvement program. In the workplace, this is abundantly clear. As an employee, no matter how elevated your rifle, your future and even your day-to-day working environment are controlled by others. A maintenance manager's ability to run an effective organization is controlled by the following: the policies and procedures of the corporation; cooperation of production managers, purchasing agents, and plant engineers; and the work ethic and skill level of the maintenance work force. Even the CEO of your corporation does not have the ability to totally selfdetermine either his future or that of the corporation. He is solely dependent on the management team, the whims of the stockholders, and active, effective participation of the entire work force. Ernest Hemingway said it best: "No man is an island." This simple truth should lead you to the conclusion that teamwork and interdependency, not solely individual contribution, are the fundamental requirements of effective plant performance. They are also the keys to your future as an employee. Frankly, I do not think any of us would want it any other way. If we could be totally independent of others, life would be very lonely. We would spend each day in an isolated vacuum in which we could not communicate with others who shared common goals. There would be no pressure to meet deadlines, no pressure to adhere to schedules, and none of the other motivations that govern our workday. While this may sound like utopia, it would get very old very fast. If you have ever worked totally alone for a period of time, you already know how important the normal interaction with others is. My job requires extensive travel. When our daughters were very young, my wife would almost assault me on the rare occasions that I was home. She talked nonstop from the time I walked through the door until my departure. At the time, I did not understand, but she

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had been trapped in the house with two infants and was desperate for adult interaction. She simply wanted to talk to someone who could talk back. We all need the interaction with our plant family in order to be effective. Your inability to totally self-determine your future does not alleviate your responsibility as an employee. As an employee, you are obligated to always do your best to effectively fulfill your assigned responsibilities. These responsibilities include providing the cooperation and support for those dependent on you. Just doing your job is not enough. You must ensure that your employees, peers, and other dependents within the plant also work effectively. Only you can determine whether or not this fundamental requirement of effective plant performance is met. The responsibilities also include voicing concerns when the policies, procedures, or methods used in your work area or in areas that affect your ability to work effectively do not work. It is easy to adhere to the status quo and ignore factors that adversely affect your ability to do your job or overall plant performance. This don't-makewaves attitude is detrimental to both your own and your plant's ability to operate properly. You also have the ability to determine how effectively your job is done. Time management is one area that can be controlled by individuals. It is also the one area where most of us fail. We permit meetings and a wide variety of other distractions to rob us of the time needed to complete our day-to-day responsibilities. Some of us cannot say no, and as a result tend to become overloaded with special projects or other work that precludes timely completion of our job responsibilities. In addition, many of us tend to procrastinate. We put off tasks that are unpleasant, that require extra effort, or that we simply do not want to do. All these factors not only affect your ability to be an effective member of the plant team, they also prohibit others from meeting their responsibilities. The ripple effect of a single individual who fails to meet the full duties of his or her job function has a horrendous, negative impact on plant performance. Earlier I stated that cooperation between and within plant functions was fundamental to effective plant performance. Cooperation

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starts with you. Part of your responsibility, as an employee, is to help those who are dependent on you to be successful. I think you will be pleasantly surprised by the reactions of other employees and functions. When you take time to help them, most will reciprocate. In most cases, the results are nonlinear. Your extra effort to ensure timely, complete reports or to be more cooperative with others will multiply and spread throughout the plant. I am amazed by the speed that the extra effort of one individual spreads to others within the plant. We cannot self-determine our futures, but our actions do, at least in part, control them and that of the corporation. Although you can assure your own failure, your peers, supervisors, and others within the plant family determine your success. We are all dependent on others, but each of us must do his or her part to ensure the future. If any individual in the plant fails to fulfill his or her role, everyone fails. Therefore your role in self-determination is twofold. First, ensure that you fully meet your assigned responsibilities. Next, you must do everything in your power to ensure that everyone who is dependent on you also has a chance to succeed.

ENFORCED

DISCIPLINE

If all employees within the c o r p o r a t i o n would automatically adhere to all the policies and procedures required for improving performance, continuous improvement would be easy. Unfortunately, this is not the case. H u m a n nature governs the day-to-day activities of m o s t employees. As a result, change m u s t be dictated and enforced. Enforcement is contrary to most corporate management philosophies. While responsibility is readily assigned, accountability is not. An integrated part of any continuous improvement program must be a well-defined policy that will ensure total adherence to all aspects of the program. M a n a g e m e n t must have the discipline to enforce adherence. Three steps must be followed to establish and sustain enforced discipline. The first is to develop concise job descriptions for every job

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function in the plant. Each of these must clearly define the specific tasks and results that are expected of the employee. The second step is to implement a viable system for regular evaluation of performance. The methodology used for this ongoing evaluation must be consistent and based solely on measurable criteria that can be universally applied throughout the plant. Although it is practically impossible to eliminate all personal bias from the process, every effort should be made to assure factual definition of performance. The final step is enforcement. This is perhaps the hardest step for most plant managers. Because enforcement will often lead to confrontation, few managers are comfortable with this task. Employees, no matter what their positions are within the company, must understand and accept responsibility for their actions. This can only be achieved through regular, consistent management enforcement.

A HOLISTIC

APPROACH

iS N E E D E D

The TPPM concept is a holistic approach to total plant performance improvement. Its premise is that optimum plant performance can only be achieved when all facets and functions within the plant operate effectively. To accomplish optimum performance levels, a unique total plant continuous improvement program must be developed for each plant or corporation that will create a working environment and management structure that is focused on product quality, on-time delivery, and competitive costs. These goals cannot be achieved unless there is an integrated effort that has the total support and participation of general management, plant engineering, purchasing, production, maintenance, and all other plant functions. Without the commitment of these critical plant functions, the factors that prevent competitive operation of the plant cannot be overcome. In addition, a plant improvement plan cannot focus on one problem area, such as quality or maintenance costs. The factors that limit product quality, late delivery, employee safety, production capacity, and profit are complex and intertwined throughout the plant organization. If poor product quality could be limited to problems within

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the production area, it would be relatively simple to correct. Unfortunately, many factors outside the production area~such as poor management, design, purchasing, and maintenance practices~directly affect product quality. The same is true for high maintenance costs, late delivery, and low profitability. The factors that contribute to these problems cut across the entire plant organization. As a result, improvement is contingent on the integration of all critical plant functions into a single effort that is committed to improving all negative factors that limit plant performance.

EMPLOYEE

INVOLVEMENT

Success also means total employee involvement. Work forces, whether direct or indirect, are the true resources of any company. Without their commitment and total involvement, management's attempts to improve plant performance will be wasted. Plant performance improvement is dependent on creating a working environment that encourages continual improvement. To accomplish this goal, the program establishes a management philosophy that provides a stable, open work environment that demands total involvement of all employees. Even t h o u g h the work ethic of our domestic work force has degraded, as a whole the American worker wants to contribute to the health of his company and to control his own destiny. Most plants do not properly utilize their employee resources. Instead they tend to isolate the worker and, to a large degree, middle management from the global operation of the plant. In many cases, no one below the board of directors and the plant management level has any knowledge of the long-range plans or problems of the company. This isolation of the worker is a serious mistake and severely limits plant performance. Unlike many other improvement programs, the TPPM approach does not focus on small-group activities. The small-group approach to employee involvement has proven unsuccessful in American plants because the tendency has been to overuse committees to address all

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decisions required to operate and improve plant performance. This, of course, pulls people away from actually completing their work.

EFFECTIVE OF S M A L L - G R O U P

USE ACTIVITIES

Some small-group tasks are essential to the success of the improvement program, but they must be limited and carefully controlled. In the TPPM program, these activities are limited to problem solving, system design, selection of critical process equipment, and other special cases in which multidiscipline input is required. These activities are carefully controlled to ensure optimum resource utilization. Universal use of small-group activity has not been effective in American plants. Although small groups have provided benefits in isolated cases, most plants have found that the use of small groups has not generated expected improvements. Many of these plants have documented measurable reductions in production capacity and equipment reliability that can be directly attributed to lost time caused by small-group activity. A marked difference exists between small-group activity and production or maintenance teams. Used effectively, the team approach to production can dramatically improve both capacity and product quality. This is especially true in assembly-line production processes. The ability to rotate jobs and the cooperative effort of the team can be extremely beneficial but can be easily diluted by uncontrolled meetings and other distractions normally associated with small-group activities.

EQUIPMENT

RELIABILITY

AND UTILIZATION

Total Plant Performance Management is designed to improve the reliability, maintainability, production capacity, and life cycle costs of all critical plant manufacturing and process systems. Optimum performance of critical process equipment, machinery, and continuous process systems is dependent on proper design, equipment selection, installation, equipment utilization, operation, and maintenance.

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Unless all these factors are addressed in the plant improvement program, it is not possible to control maintenance costs or to achieve optimum performance from the plant. The maintenance function can only influence one of these five keys to optimum performance. Therefore, a total plant improvement program must include specific methods that will integrate the plant's engineering, purchasing, production, and maintenance functions into a single, focused management plan.

RETURN-ON-INVESTMENT Few, if any, corporations can afford the costs associated with continuous improvement. In a time where margins are small or nonexistent, many companies find it difficult just to meet their day-to-day fixed costs. A viable continuous improvement program must be designed to pay for itself. Do not be misled~this absolute requirement is not an arbitrary management view; every plant's profit-and-loss statement clearly shows that the financial resources required to support an improvement program are simply not available. Every decision that is made must be driven by this single f a c t o r ~ return-on-investment. Unless there is absolute certainty that your program can pay for itself, it should not be implemented.

IMPROVEMENT

OF BASICS

The minimum criteria for a comprehensive plant improvement program must include the following keys to optimum plant performance.

EVALUATE The evaluation should include financial information, management philosophy, and performance of various plant functions, as well as the operating efficiency of critical plant production systems. Properly conducted, the plant evaluation will establish a baseline of current

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plant condition, identify inherent problems, and provide direction for improving the productivity of the plant. One evaluation of plant condition, no matter how detailed, is not enough to ensure the long-term viability of the plant. A total plant program will also implement a continuous evaluation program that will provide the means to continually improve plant performance. This evaluation program, coupled with a comprehensive predictive maintenance program, will provide the management information required for optimizing plant operations. PLAN

Effective planning is a fundamental requirement of plant performance. As part of a continuous improvement program, planning will determine the success or failure. The same is true of all aspects of corporate and plant activities. Well-defined strategic plans are essential for long-range operations of all corporations. No one in the corporate management team would seriously consider making long-term business decisions without referring to the corporate five-year plan, but these same managers make day-to-day decisions that are devoid of a comprehensive plan. Within critical plant functions, such as production, procurement, engineering, and maintenance, planning is also critical. None of these functions can effectively use its resources, both human and capital, without a concise plan that clearly defines the most costeffective means of accomplishing its mission. MANAGE

Ineffective management philosophy is a major contributor to poor plant performance. Studies have found that 85 percent of all plant productivity problems can be directly attributed to the management structure or limitation imposed by America's business philosophy. This philosophy has become extremely shortsighted. Many decisions are based strictly on short-term profitability rather than the long-term well-being of the company. As long as American corporations can show a short-term profit and pay quarterly dividends to

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their stockholders, they are judged a success. Little, if any, thought is given to what impact these decisions will have on the company next year or five years from now. This concept has a number of serious limitations. First, many of our decisions are contrary to long-term survival of the company. In addition, this profit-at-any-costs sends the wrong message to the work force. By implication, the company's focus on profit lowers the acceptable standards for product quality and optimum utilization of resources. In effect, management is telling the workers that cutting corners, lowering quality standards, omitting needed maintenance or upgrades to critical plant systems, and a multitude of other factors that directly impact long-term plant performance are acceptable as long as the monthly profit forecast is met. Management really has three basic tasks to perform: establish the requirements for success, supply the resources needed to meet those requirements, and encourage and help the employees to meet those requirements. Employees will take the requirements just as seriously as management takes them. Employee morale and attitude problems come about because of vacillation of management's dedication to the policies and processes. One factor that has severely limited our management methods is a lack of accurate, timely information. Few managers have the minimum level of information required to plan, identify inherent or incipient problems, or control operating costs within their departments. American industry typically falls into one of two categories. The accounting and reporting procedures either do not generate any useable management information, or they produce too much. In those instances in which data are available, they are often unusable. Our profit-driven business philosophy is not geared to track the plant performance indices that are required to optimize plant performance. Instead, we acquire and report mountains of financial data that, while impressive to stockholders, are useless as a management tool. Corporate and plant management must adopt a management philosophy that is conducive to optimum plant performance. They must create a plant environment that eliminates all the bad habits that have developed throughout the plant and replace the bad habits with a culture that will not tolerate anything less than optimum perfor-

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mance. The Total Plant Performance Management program will provide the means, including both information and management methods, to upgrade the management philosophy so it will support, not hinder, optimum productivity. SELL

The adage "nothing happens until the sale is made" is true. The sales function has a critical role in plant performance. It is not enough to simply meet business-plan sales volume. The sales function must load the manufacturing or production facility properly. The primary factors that must be considered include product mix, order size, lead time, and effect on equipment reliability. Sales must also be able to accurately forecast future demands on production facilities. W i t h o u t these fundamental requirements, production scheduling and plant management cannot achieve acceptable utilization of plant equipment. Sales personnel must also have the basic skills required to achieve these goals. In too many cases, the corporate sales forces are staffed with order takers, not professional salesmen. There is a marked difference in these two classes of personnel. The order taker is just t h a t ~ he or she will accept any order, no matter what its impact on plant performance. A classic example of an order taker can be found in a Coca-Cola operation that my company evaluated a few years ago. When the general manager asked us to evaluate the facility, he stated that if he could achieve 100 percent availability and could operate at design capacity, the plant would break even. Obviously, this seemed impossible. Our evaluation confirmed his comment. An order taker had accepted a long-term contract for one third of the plant's production capacity at a substantial loss. If the contract was cancelled and the plant operated at two-thirds capacity, the bottomline profits would be in excess of $50 million. In another example, an order taker for a integrated steel mill accepted an order for a product that no one else would attempt to produce, was nearly impossible to make, and caused serious reliability problems for plant production systems. Niche markets are an accept-

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able and sometimes smart business approach, but not in this case. To compound the error, the order taker accepted a cut-rate price for the product. DESIGN

The first criterion for optimum performance from plant production systems is proper design. Many American plants are old, and the equipment is outdated. Over the years, we have modified and remodified most of our manufacturing and production systems without any adherence to good design practices. The result is that many of these critical systems are no longer reliable, cannot be maintained, and are expensive to operate. All critical process machines, equipment, and systems must be designed for maximum reliability and availability. In addition, the design must consider the total operating or life cycle costs of the machine or system. Consideration must also be given to maintenance of the equipment with the ultimate design goal of maintenance-free operation. A team concept should be used for all design functions. The team should include conscientious representatives from engineering, operations, maintenance, and purchasing. Each of these team members has knowledge that is invaluable to the design process. Because of their experience with similar plant systems or machines, the maintenance craftsman and operator can point out inherent design problems that have adversely affected performance and offer suggested modifications that will improve the system's reliability and maintainability. The plant engineer can provide insight on new technology and methods that will improve the overall performance, and the buyer can input information on what systems are commercially available. The team should have the final authority on the design specifications. In this instance, design includes equipment design, selection of the proper equipment for a specific application, and proper installation.

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PURCHASE

Equipment selection, both new and replacement, is critical for optimum performance. The norm in the United States is to purchase from the low-bid vendor. This cheaper, faster, and quicker (or CFQ) concept is not conducive to maximum availability and maintainability of the plant. To compound the severity of this problem, equipment vendors have also suffered from the same problems that affect your company. Their product quality and reliability has also declined to a point that reliable, maintenance-free operation of their products is suspect. Many vendors appear to have adopted a strategy of planned obsolescence. To maintain acceptable profit margins, they too cut corners, reduce safety margins, and generally reduce the reliability of their equipment. In many cases, the only profit a vendor makes on his equipment will come from replacement or repair parts. In today's market, the old adage "buyer beware" is truer than ever. Companies that do not insist on reliability and maintenancefree equipment will get just what they ask f o r . . , constant production problems and high operating costs. Equipment, machinery, and systems must be purchased based on the best life cycle cost evaluation. This is the cost associated with a machine or system during its entire operating life. Life cycle evaluation must include initial capital cost, operating cost, and maintenance cost. Equipment must be selected based on the total cost of equipment, not just the initial purchase price. As in design, a team of cognizant representatives from engineering, operations, maintenance, and purchasing should make the final decision on purchases of plant machinery, systems, equipment, and replacement parts. To ensure that both new and replacement equipment meets the life cycle costs and maintenance-free criteria, the purchasing department should develop standard acceptance criteria that will become an integral part of every purchase order. The acceptance criteria should define the specific performance levels, maintenance costs, and life cycle costs that are expected from the equipment and testing procedures that will determine acceptance by the company. These factory and site acceptance tests must be well-defined and accepted by the vendor prior to placement of the purchase order.

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TRAIN

Operators and maintenance personnel must have the basic skills and knowledge required for achieving maximum performance from the plant. Well-trained operators and maintenance mechanics are an absolute requirement of a plant performance improvement program. The work force in the United States is the least-trained work force in the world. While our offshore competitors expend a large percentage of their annual operating budgets on training, U.S. industry has ignored this critical need. The amount of technical information appears to be doubling every five years. The technology boom is continually demanding more skills and higher skill levels of the people who operate and maintain plant equipment and systems. Approximately one half of the technical skills used by workers today will be obsolete in three to five years. Just ten years ago, one half of the worker's technical skills became obsolete in seven to fourteen years. Based on comprehensive training need analyses and basic skills assessments, the Total Plant Performance Management program should establish educational and training systems that focus on results and opportunities for improvement. Education of the decision-makers and equipment and systems vendors is also essential. To a great extent, the performance of our plants depends on the adherence of our vendors. Therefore, the training effort should extend to include an upgrade of their skill levels. The TPPM program will establish basic skills improvement programs to meet the needs of the employees and the plant. OPERATE

Critical process machinery, equipment, and continuous process systems must be properly operated to achieve maximum production capacity, product quality, and minimum downtime. Other employees, who may have had a partial or even erroneous understanding of proper operating procedures, taught most plant equipment and system operators. As a result, trainers and operators have no concept of

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the effect improper operation has on product quality, machine reliability, or the effort required to correct the damage. This problem is compounded by the incentive bonus programs that many plants have implemented to increase production capacity. Too many of these incentive programs do not address the adverse effect on product quality and maintenance costs that result from the operator's attempts to meet production quotas. As long as the line holds together long enough for the shift operator to meet incentive production levels, neither he nor plant management is concerned about the losses incurred on the next shift. Standard operating procedures (SOPs) designed to optimize product quality and maintenance-free operation must be developed and used if maximum performance is to be achieved. Coupled with operator training and modification of the incentive program to reward product quality and maintenance-free operation, much of the negative impact on plant performance can be eliminated. The TPPM program must be structured to impart a sense of operator ownership of, and responsibility for, his or her machine or system before optimum plant performance can be achieved. This concept is contrary to today's business environment. Operator job descriptions have changed over the years and no longer include the routine inspection and adjustments essential to the long-term health of critical production systems. In today's environment, the operator has no other responsibility than to produce a product. Any adjustments or repairs are the sole responsibility of the maintenance department. The result is a classic example of the it's-not-my-job syndrome that has infested our work place. The Japanese solution is autonomous maintenance, in which the operator is also responsible for inspection, cleaning, and routine maintenance of his machine. This concept, adapted from Phillip Crosby's concepts, is valid and should become an integral part of the total plant improvement program. However, the reactions of operators, maintenance craftsmen, and trade unions have limited application of this concept in domestic plants. In part, this reaction has been because of semantics. The use of the word maintenance to define the operator's role has given the impression that the company

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is attempting to define a new job classification that will reduce the number of employees. In truth, the concepts defined by autonomous maintenance are simply a return to values and job descriptions that were an integral part of America's plant fifty years ago. As applied within the total plant program, the operator will become a member of the team responsible for critical plant equipment. The machine operator is the plant's first line of defense. Properly motivated, the operator can reduce, if not eliminate, the impact of product quality, production capacity, and maintenance problems. The operator's visual and audible observations, coupled with a thorough understanding of the machine, are perhaps the best predictive maintenance tool available to the plant improvement program. MAINTAIN

Plant systems, both machinery and support functions, must be maintained at their maximum levels of performance. Everyone in the plant must be absolutely committed to continuous improvement and maintenance of the program. In this approach, both the operator and maintenance craftsman are responsible for maintenance of critical plant systems. Maintenance will include regular inspection, cleaning, and adjustment of the machine by the operator and correction of machines, equipment, and systems problems by the maintenance department. MONITOR

The operating condition of the plant machinery, production process, maintenance activity, and the other critical functions of the plant must be monitored on a regular basis. Predictive maintenance technologies will be used to routinely quantify the operating dynamics of all critical process machinery, equipment, and systems and identify all deviations from optimum condition. Although traditional predictive technologies, such as vibration analysis, infrared analysis, and lubricating oil analysis, will be used for the program, their application will be expanded to provide a much greater level of detail and

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accuracy. Unlike traditional programs, the predictive maintenance program will not be limited to maintenance scheduling. Data derived from the predictive maintenance program will also provide much of the information that managers need to plan, optimize performance, and control costs within their divisions. In the plant improvement phase of the program, the monitoring program will be expanded to isolate, identify, and resolve incipient or potential problems within the plant. In this expanded form, predictive techniques will be used to reduce or eliminate the need for maintenance. Maintenance prevention should be the long-term goal of all plant improvement programs. Properly implemented, the predictive maintenance program will provide the means to anticipate potential problems and permit minor adjustments that will preclude the need for corrective maintenance. REPAIR

None of the efforts defined for the plant improvement program will be effective without proper repair of critical plant machinery and systems. Maintenance craftsmen must have adequate skills, adequate tools, and a maintenance management system that supports proper and complete maintenance of critical plant systems. Maintenance skill levels have severely declined over the years. The master mechanics of yesterday, with few exceptions, have gone the way of the buffalo. Plant evaluations have shown that the majority of maintenance craftsmen do not have the basic skills required to properly install a bearing, properly install plant equipment, align machinetrains, or balance rotating machinery. Analysis of maintenance problems and machine breakdowns indicate that improper repair or installations of plant machinery is a major contributor to the high maintenance costs in many of our plants. To resolve this serious problem, the plant improvement program must implement a craftsman training program that will provide the basic skills and knowledge required for properly maintaining and repairing plant equipment.

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In addition, the training program must address the shortcomings of our education system. A growing number of our maintenance workers do not have the basic reading and comprehension skills required to understand the technical literature contained in original equipment manufacturers' operating and maintenance manuals. Therefore, the plant improvement program must provide this additional training. Proper repair also depends on the attitude and philosophy of the maintenance organization. The department must provide the tools, resources, and support required to properly repair plant equipment. In too many cases, maintenance managers, in their zeal to return the equipment to production, will force the craftsmen to take shortcuts that prevent proper repair. This bailing-wire-and-Band-Aids mentality must be replaced with one that is conducive to optimum reliability of critical plant systems. Planning is also a fundamental requirement for proper repair. Each repair should be properly planned and scheduled to permit adequate definition and time to do the job right. In addition, standard maintenance procedures that provide step-by-step procedures for proper repair are absolutely essential. IMPROVE

The vision of Total Plant Performance Management is to create a culture within the plant that is committed to continual improvement. Every employee must strive to improve his or her efficiency each day. Long-term success depends on this attitude of never being satisfied with goals achieved. TRACK

Success requires constant, accurate tracking of performance. This includes tracking machine histories, reasons for delays, maintenance, efficiency, and production efficiency. The tracking and monitoring program provides the timely data required to plan improvement for the total plant program.

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A comprehensive information management program is key to the ability to track and effectively manage plant operations. The amount of data required to properly manage a plant often defeats the manager's ability to use the data. The information management system must be able to assimilate tons of raw data, reduce the raw data into useful management information, and generate timely reports that can be used to evaluate and control plant performance. The information management program must satisfy the unique requirements of general management, division management, maintenance, plant engineering, purchasing, and production. Each of the groups will input meaningful data into the system, and each has unique requirements for data that will reside in the central data base.

OPTIMUM

PLANT

PERFORMANCE

The objective of the Total Plant Performance Management program is to capture short-term benefits that will both offset incurred costs and generate immediate improvement in bottom-line profit. In the long term, the goal is to continually improve the performance of the plant until optimum performance levels can be achieved and sustained. The program continues until the following occurs: defects, downtime, and accidents are reduced to zero; production capacity and product quality are increased to their maximum levels; and production/maintenance costs are reduced to their absolute minimum. Then those performance levels are maintained for the remaining life of the plant. Therefore, the program must address and incorporate specific methods that are required to correct design, purchasing, installation, operation, and maintenance problems and to ensure that optimum plant performance is the only acceptable norm throughout the plant.

CONCLUSION Now that we've set the stage, let's take a look at the business side of TPPM.

Chapter 3

It's G o o d Business

Innovation underpins the strategies and successes of corporations that possess proven, winning performance. These corporations innovate early and often. This constant innovation creates new markets, new products and services, and new ways of doing business. Almost by definition, innovation means breaking the rules and overturning conventional wisdom. It's the opposite of imitation and of businessas-usual. For the new competitor that seeks to survive and succeed in a market where established competitors have the advantages of longstanding customer relationships, scale, reputation, and financial staying power, innovation is not just a nice-to-have. It is a necessity.

VALUE WINS Business success is far more than the science of managing scale and cutting costs. It is the art of leading people, nurturing them, challenging their creativity so they will figure out what customers really need and want. While keeping a close eye on costs is important, it will not improve plant performance. When an organization's singleminded focus is on cutting corners, minimizing production costs through scale, and doing the same things more cheaply, then new ideas become distracting diversions and are often ignored. 64

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65

Successful corporations have rediscovered and put back t o work the old tradition that used to be known as good old American business sense. They see the role of companies as taking note of customer needs and meeting those needs in a distinctive way by innovating on the customer's behalf. Successful companies realize consumers know that they get what they pay for. These companies also realize their customers are smart enough to realize that there are no free lunches. That is why virtually all the winning companies compete on the basis of value, not price. It's why they often command premium prices, even in price-sensitive markets.

BUREAUCRACY Bureaucracy, not unfair foreign competition, may well be the gravest threat to American industry. It smothers innovation, substituting rules for common sense, stultifying decision-making, and killing initiative. Sadly, bureaucratic arteriosclerosis is as prevalent in private enterprise as in any of the cartoon-provoking paradigms of government bureaucracy. It is as insidious and stubborn in the business world as crabgrass in a suburban lawn. Once it appears, it is excruciatingly difficult to eradicate. In the advanced state, bureaucracy can cause individuals to work for the purpose of ruling, avoid risk, be afraid of trying new ideas, value their personal positions and prerogatives above corporate achievement, avoid teamwork, and delay action. By themselves, each of these phenomena costs money, which makes each undesirable. In combination, they can be deadly. Innovation requires champions, unconventional thinking, and willingness to risk failure. Bureaucrats thrive on writing long memoranda, checking all the bases, arranging meetings that are long on agenda and short on substance, and above all avoiding decisions and risk-taking. If the multiple forms to be filled out and layers of organization to be persuaded do not kill a new idea, fear of criticism or dismissal in the event of failure will.

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Successful companies seem to avoid this peril by fighting bureaucracy aggressively on every front. The winning performers are obsessively dedicated to keeping their systems and structures simple and uncomplicated. They have found that doing so is far easier and more fruitful than trying to cope with cumbersome reporting arrangements and layers of delegation. Structurally, they strive to keep organizational units small. To accomplish short-term objectives, they establish temporary work groups and ad hoc task forces. They steer away from organization charts, especially charts that highlight differences in the pecking order. They emphasize delegation of decision-making responsibility. They concretely encourage managers to get into the field, to mingle with the employees and customers. They refine job descriptions and responsibilities continually. No one defends bureaucracy, but the fast-moving, agile firms we have studied do more than bad-mouth it. They contain and combat corporate bureaucracy in at least three classic ways. TURN

EMPLOYEES

INTO ENTREPRENEURS

No one is more likely to think like an owner than an owner. Instead of imposing systems on their employees, the winning companies let them earn an actual piece of the action. Managers and other employees of successful corporations own about 30 percent of their companies. This is about six times the employee ownership among the country's largest corporations. ELIMINATE OVERHEAD

TRADITIONAL FUNCTIONS

MANAGEMENT

Successful companies have some of the most creative and practical business strategies. About 40 percent of these companies do not have corporate planning departments. Those that do, have a small staff whose job is to coordinate and perform devil's advocacy, not to design or approve final plans. Because of this, these companies

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67

achieved 40 percent annual compound growth in market value during the five-year period that we tracked. The winning performers are convinced that planning, personnel, communication, and similar staff tasks are too important to delegate to staff specialists. These companies frequently regard such functions as an explicit responsibility of every line manager. The winners let general managers be general managers. ELIMINATE

BUREAUCRATIC BEHAVIOR

Only senior management can control corporate bureaucracy. Successful companies have strong leaders who clearly will not tolerate bureaucracy or bureaucratic behavior. Corporate politicians do not survive long in this environment, and these companies are much more effective as a result.

THE BOTTOM LINE

iS M O R E T H A N

PROFIT

Everybody except for the truly successful company knows that making a lot of money is the sole measure of success. When asked about corporate credos and philosophies, most business leaders will parrot literate, concise statements of their corporate values. In each case, these credos set forth vividly the company's guiding principles. They define the ways value is to be created for customers, the rights and responsibilities of employees, and an overall affirmation of "what we stand for." A statement of beliefs alone will not make a successful enterprise. Credos are an articulation of culture, not a substitute for it. In fact, the concept of corporate culture that has enthralled some business writers, academics, consultants, and executives has in some quarters taken on the trappings of a fad. But culture does not get installed overnight by committees and consultants. Culture is the articulation of well-thought-out, passionately felt values that give meaning to institutions. Among the winning companies that we studied, cultures are deeply rooted and widely shared.

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The general themes that run through the culture in most winning performers' companies include the following: EARNED

RESPECT

This refers to a universal sense that the company is special in what it stands for, what it does, and how it does it. This earned respect demands and deserves u n c o m m o n effort and contribution from those who work there. All people need to believe they make a difference. When the corporation has a well-defined vision and mission that concisely define the role of the company as a valuable member of the local and world community, the work force will gain this critical sense of worth. EVANGELICAL

ZEAL

The winning companies have an honest enthusiasm that spills over on those with whom the enterprise does business, from employees and prospective employees through customers, suppliers, distributors, and even competitors. In successful companies, employees voluntarily work whatever hours are required to fully complete their tasks. There is no need for management direction to enforce the extra effort required to meet deadlines or delivery requirements. DEALING

WITH PEOPLE

Successful companies have the tradition of communicating just about everything to everybody in the organization and enfranchising them as partners in the crusade. Strategies, plans, ambitions, and problems are not the secrets of the palace guard; they are known and appreciated throughout the company. PROFIT AND WEALTH-CREATION

Money is a useful yardstick for measuring quantitative performance, profit, and an obligation to investors. Even though most of the CEOs we interviewed came from backgrounds of modest means, making money as an end to itself ranked low on their lists of priorities.

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The resulting corporate value systems eliminate the need for much of the bureaucratic baggage that burdens many organizations. Rules, regulations, policies, procedures, and formal instructions are not necessary when powerful, widely comprehended guiding principles are in place. By contrast, in companies that lack well-understood, well-followed guiding principles, formal systems and processes proliferate and grow ever more explicit, detailed, and universal. They direct people on what, where, how, when, and to whom, as opposed to guiding principles, which instill an understanding of why. Instead of creating and enforcing new rules and regulations, the winning companies reinforce their philosophies and creeds by word and deed. The majority of the winners does not simply develop a credo and then hope it will work its way through the organization. Top managers take the lead in promulgating it.

LEADERSHIP Two stereotypes exist of the kinds of men and women who lead the winning corporation. Both are wrong. On one hand, some subscribe to the popular image of the CEO as a creative genius who is soul-driven by the need to achieve but is personally disorganized, hopelessly short-term in his or her perspective, and undisciplined in direction. Alternatively, other people conjure up the image of a cool, rational professional manager who, by dint of training and expertise in sophisticated scientific methods and theory, can run just about anything. In winning companies, the executive shows extraordinary commitment to the business, often to the point of obsession. That these executives work long hours is demonstrable. The average CEO works an average of sixty-four hours per week and may spend even more time in meetings or preparation. More revealing and important is the intensity of these executives' efforts. The CEOs with whom we talked were genuinely excited~even about mundane details of the business. They cited market share shifts, individual customer relationships, costs, competitor actions, yields, rates, and much more without referring to notes, printouts, reports, or other assistance.

70

MANAGEMENT

Total Plant Performance Management BY E X C E P T I O N

The practice of dealing with something only when it stops running smoothly, which has long been a foundation of scientific management, is a dirty process. Management's attitude is the opposite of the if-it-ain't-broke-don't-fix-it plan. These managers say instead, "If it ain't been fixed, it'll break." Their habit of immersing themselves in the business is combined with a constitutional contempt for business-as-usual. In their view, if things work well, they can work better, and if they don't figure out how, the competition will. Management by exception (managing by ignoring issues, avoiding conflict, and so forth) requires formal information and control systems, to help the managers keep abreast of things. While the companies we studied generally had strong financial and operating control systems, the CEOs and other top managers took imaginative steps to sample straight information about important matters themselves. They spent lots of time with customers, solving problems, getting ideas, learning about the competition, and just listening to employees. They used their own and their competitors' products, occasionally spent time on the firing line (as salesmen, engineers, or complaint takers), and even rolled their sleeves up and worked too. They got their hands dirty. Spending time in the trenches is an easier way to find out what is going on and to monitor key functions than listening or reading formal reports. It also minimizes the possibility of distortion. In sum, the winning chief executives have their priorities straight. Only the CEO's vision and ability to inspire others to share it limits the company's aspirations. At the same time these executives are solidly anchored in reality. The winning CEOs calculate the payoff from risk-taking over the long haul, not by quarterly earnings trajectories. If they do not fix employee skill problems, they forsake some opportunities that on the surface appear extremely attractive. Most important, they never blink from the recognition that innovation is the only sustainable basis of competition, and they never lose the voracious appetite for change that defines a winner.

It's Good Business COUNTING

ON

71

PEOPLE

If I had to single out one overriding theme among successful organizations, it would be their willingness to count on the people that make up their workforces. Except in a small company, neither the CEO nor the senior management team can individually ensure the success of the business, so they find various ways of saying to their organizations at large, "Only you can make this company a success. We can't do it without you." This often unspoken attitude toward people seems to derive from a deep-seated belief that good people will consistently rise to the occasion. They will welcome responsibility and be productive. They want to be winners and will show ingenuity in finding ways to succeed.

BENEFITS

OF TOTAL

PERFORMANCE

PLANT

MANAGEMENT

The objective of all continuous improvement programs is t o improve the overall performance of the plant's resources. Initially, a successful program must generate short-term benefits that will at least offset incurred costs. Then, it must provide the means to sustain and expand the return-on-investment. The TPPM approach to continuous improvement is specifically designed to provide short-term improvement and has earned a proven record of success. Typical short-term results of this type of program not only offset all incurred costs but also generate first-year improvement in bottom-line profit. Consider the following examples. T Y P I C A L B E N E F I T S OF I M P L E M E N T I N G THE TPPM PROGRAM

A large, single-plant integrated steel mill had a six-year history of annual before-tax losses in excess of $100 million. Prior to implementing the TPPM approach, the mill investigated all options,

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Total Plant Performance Management

including a complete evaluation conducted by a Japanese competitor. All who evaluated the mill recommended closure of the mill because the problems were too great for cost-effective resolution. The mill had a fifth-generation, 10,000-man hourly work force. The hourly work force was equally divided between production and maintenance, and most of the work force was made up of active members of one of the thirteen unions on site. Skill level varied from nil to mastery, but most of the work-force members lacked the basic skills needed to complete their job functions. The mill had developed a reputation for poor quality, late delivery, and a complete lack of customer service. The total cost of poor quality was the equivalent of $100 per ton, or about $400 million annually. The combination of poor quality and late delivery had resulted in the loss of major customers. The annual expenditure for traditional maintenance was almost $500 million, or 25 percent of total revenues. Breakdown maintenance was the norm, and the mill did not have a maintenance planning function. About 2,000 long-term contractors augmented the 5,000-man maintenance work force. Even with this extensive work force, overtime premiums added about 20 percent to the annual maintenance labor costs. A Total Plant Performance Management program reversed this six-year trend. In the first full year of the program, the plant recorded a before-tax profit of $180 million. The short-term focus of the program was equipment utilization and reliability improvement. In the first year, the plant produced an additional 477,000 tons of prime-quality steel that generated an increase in revenue of $380 million. This increase in revenue was more than enough to offset all startup costs, including a 12-percent increase in maintenance costs. Other first-year improvements included the following. B r e a k d o w n Losses Total plant delays caused by machine and system breakdowns were reduced by more than 15.4 percent as a direct result of a comprehensive reliability improvement program. The key to this reduction

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73

in delays was that the program was not limited to prevention of unscheduled delays. Instead, the effort was focused on elimination of all delays. Over a four-year period, total downtime for all critical plant production systems decreased by more than 50 percent. Within this same time period, first-time-through capacity was increased by more than 60 percent.

Delays and Planned Downtime Arbitrary acceptance of planned delays for maintenance severely limits available production time. Too many plants accept historical data as the only reason for planned maintenance downtime. A comprehensive predictive maintenance program must include specific methods to evaluate all delays and downtime. The objective of predictive maintenance is to achieve both 100-percent availability and 100-percent capacity factor. The 15.4 percent improvement in breakdown losses does not include the added production capacity that resulted from elimination of scheduled downtime. This classification added an additional 10 percent to the availability of the mill in the first year of the program. In the first four years, availability, based on 8,760 possible annual hours, improved to 99 percent. This level of availability has been sustained for almost ten years. Q u a l i t y Defects In the first year, rejects, diversions, and retreats were reduced by more than 10 percent across the integrated steel mill. This reduction reduced the negative costs of poor quality by more than $5 per ton of total product produced, or a cost reduction of 13 percent. After two years, the total costs associated with poor quality had been reduced by more than 24 percent, or $10 per ton. In the fourth year, product quality had been improved an additional $10 per ton. Based on the annual production capacity of almost eight million tons, this represents a savings of $160 million annually.

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Total Plant Performance Management

Capacity Factor Set-up and adjustment, reduced speed in production, and startup losses, as well as operating efficiency of plant processes, directly affect the overall capacity factor of a plant. In the integrated steel mill, reduction of these major losses, in conjunction with the reduction in delays and rejects, resulted in an overall increase of 2.5 percent in net production capacity. The net result, in prime-quality product, was an additional 477,000 tons produced at the end of the first year. This was equivalent to a $380 million increase in revenue and generated an NIBT (net income before taxes).

Maintenance Costs Traditional applications of predictive maintenance will do little to decrease the overall maintenance costs within a plant. In most cases, the only reduction will result from an incremental reduction in overtime costs. Material costs for such items as beatings and couplings will increase, and the net overall effect will be a slight increase in the overall costs. Predictive maintenance based on operating dynamics will dramatically reduce both the labor and material (that is, maintenance) costs. After two years, the example steel mill reduced its total labor costs by more than 15 percent, or $45 million per year. In addition, its material costs were reduced by more than $15 million per year. The best part of the benefits generated by a total plant approach is that the improvements will continue as long as the program is followed. The program illustrated in the example was started in 1989. In 1998, the plant continues to enjoy the benefits of an effective, integrated continuous improvement program.

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75

CONCLUSION The return-on-investment illustrated above is typical of the improvement that can be achieved when a total-plant continuous improvement program that is designed for the specific problems of that plant is fully implemented. The same level of improvement has been achieved in other integrated process plants and discrete manufacturing plants worldwide. This approach can also work for your plant.

Chapter 4

Equipment Reliability As mentioned previously, equipment reliability is the basic requirement of optimum plant performance. If a plant does not have reliable manufacturing and process systems, it cannot possibly improve performance. Product quality, production capacity, and profitability all depend on a plant's equipment being reliable. Few would disagree with the preceding statements, but equipment reliability receives little attention in most plants. In fact, few can agree on the definition of reliability. To some, reliability means that a machine or system will function, without regard for its performance level. To others, the machine must operate at a specific performance level before it is considered dependable. To me, neither of these definitions is correct. Equipment must function at rated capacity, without product rejects, and maintain this ability for the entire planned production time before it can be considered reliable. Three factors define equipment reliability: capacity rate, quality rate, and availability rate. Plant systems must be judged on all three factors.

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Equipment Reliability

MEASUREMENT

7'7

OF RELIABILITY

CAPACITY RATE Every machine or system has a measurable design capacity. In other words, it can produce a specific volume of work. In the case of a centrifugal pump, it is designed to produce a specific flow and pressure. Capacity rate measures the actual pump output as a percent of design output. The same is true for production systems. They are designed to produce a specific number of parts or products. Their capacity rate is measured in the same way.

Q U A L I T Y RATE Production machinery is not designed to produce rejects. It is designed to produce prime-quality parts or products at its maximum capacity rate. The quality rate is defined as the total number of rejects, reworks, and diversions generated by the machine as a percent of total products produced.

A V A I L A B I L I T Y RATE Many confuse availability with equipment reliability. In reality, reliability is only one part of the calculation. Availability is the actual time that the machine or system is capable of production as a percent of total planned production time. Availability rate should not be confused with overall availability. The latter is calculated using total calendar time as the divisor, not planned production time.

OVERALL

EQUIPMENT

EFFECTIVENESS

Overall equipment effectiveness (or OEE) is one key to optimum plant performance. Therefore, all activities of the OEE program are aimed toward achieving maximum first-time-through capacity, prime product quality, and lowest total production costs.

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Total Plant Performance Management

Consistent use of machinery and process systems that are properly designed for the plant applications is critical to the availability, reliability, and maintainability of our plants. It also has a predominant influence on the overall effectiveness and operating costs of critical plant systems. A selection process based solely on the lowest perceived cost (that is, the low bidder) is not conducive to optimum plant performance and will severely limit the plant's ability to compete in the world market. In too many cases, the design, equipment selection, and purchasing processes do not consider the total cost of new and replacement equipment. In most plants, the only consideration is the initial costs or purchase price of the equipment. The results of this approach are excessive delays, reduced capacity, high maintenance and production costs, and artificially short operating life. All these factors add up to abnormally high life cycle costs. To achieve optimum plant performance, all new and replacement equipment, machinery, a n d / o r process systems must be selected, purchased, and operated based on maintenance-free design and their life cycle costs. This approach must consider all the factors that translate into reliability, maintainability, and total operating cost of critical plant systems.

LIFE

CYCLE

COSTS

Life cycle costs are defined as all direct and indirect costs required to procure, install, operate, and decommission plant equipment, machinery, and systems. DEFINITION

OF L I F E C Y C L E C O S T S

The U.S. Office of Management and Budget defines life cycle costs as "the sum of indirect, recurring, non-recurring and other related costs of a large-scale system during its period of effectiveness." A second definition provided by the same source defines them as "the total of all costs generated during the design, development,

Equipment Reliability

7'9

production, procurement, operation, maintenance, and support processes." So, simply stated, life cycle cost is the total cost of a machine or system during its entire operating life. Many of the critical production systems within our plants do not perform as intended, nor are they cost effective. To a large degree, this is the direct result of poor design and the absence of life cycle considerations during the selection and procurement processes. To address the aspect of true equipment cost, a large percentage of the total life cycle cost of a system can be attributed to the recurring costs after the equipment is installed in the plant. F a c t o r s o f Life Cycle C o s t s The primary factors that comprise the life cycle cost of plant equipment include the following. Procurement Costs

This category includes all the costs associated with the procurement cycle. These costs include more than just the purchase price of the equipment. They should also include all the labor required to develop specifications, issue and evaluate bid specifications, and negotiate the final procurement of equipment. These often-overlooked costs can be substantial and should be considered as part of the total cycle cost of plant equipment. For example, the effort required to develop detailed equipment specifications may require two or more man-years. It requires a thorough engineering analysis of the application, an evaluation of operating and maintenance histories of similar applications, estimates of total operating costs for the expected lifetime of the equipment, and much more. Because of the effort involved, many plants omit this part of the procurement process. As a result, they do reduce the procurement cost. Unfortunately, these perceived savings are lost in the first few years of operation because of excessive operating costs that would have been prevented by this step.

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Installation Costs This is another life cycle cost that is often omitted. When most plants estimate the installation cost of new equipment, they do not include all the required costs. Major items, such as new foundations, are included, but other higher costs are left out. Costs such as capacity losses that result from interruption caused by the installation are typically not included. All costs, including capacity losses and quality losses, should be included in this category of life cycle costs.

Operating Costs All costs required to operate the equipment throughout its entire useful life should be included in this category. These costs include more than just the energy consumption, expendables, and manpower required to run the equipment. In addition, other costs, such as training, should be included. The most often overlooked costs include the following. Training Costs. Training costs are rarely included in a plant's life cycle cost calculation. Because the level of training required will vary depending on the complexity of design and operating variables, training costs may be prohibitive for some systems. However, this single factor in many cases should be the deciding factor during the procurement process. The level of training required for properly installing, operating, and maintaining equipment or process systems varies greatly. The factors that determine adequate training levels include complexity of the machine, how well the operator interface is designed, and how much automation is built into the equipment. In many applications, actual training cost is almost nothing. Too many plants ignore or omit this activity altogether. This omission is because of either a lack of understanding on plant management's part or a failure to include training in the project management function. Whatever the reason, this is perhaps the most damaging omission of the life cycle process.

Equipment Reliability

8!

A failure to properly train operators and maintenance personnel will directly influence the life cycle cost of plant equipment. Without adequate training, these costs will dramatically increase and remain abnormally high throughout the useful life of the equipment. Maintenance Costs. The level of maintenance required to properly maintain equipment varies greatly. Some machines are designed for ease of maintenance, and others are not. The maintenance requirements of new equipment should be a major part of the procurement evaluation, but they are too often totally ignored. This category should include all costs, including periodic rebuilds, that are required to maintain the equipment in optimum operating condition throughout its entire useful life. A viable comparison of similar equipment will reveal a wide range of costs. Equipment designed for maintenance-free operation will have a much lower life cycle cost than one whose design ignores maintenance requirements. This single factor can double or quadruple the life cycle cost of plant equipment. Decommissioning Costs. Sooner or later the equipment will reach the end of its useful life. At this point it will have to be removed from the plant and replaced with a new system. This cost category includes all costs associated with this activity. In some cases, this is a relatively minor cost. For example, an ANSI standard pump can be replaced by simply removing the pump from its baseplate and installing a new ANSI standard pump. Because all pumps built to this standard have identical configurations, there are little incurred costs, other than labor required to remove and install the pumps. At the other end of the spectrum, a system that handles hazardous waste may have a decommissioning cost that is much greater than the total life cycle costs during the machine's useful life. This cost must be considered during the procurement process and in many cases will be the determining factor in the purchasing process.

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Proper design and selection of plant equipment is the first, critical step toward optimum plant performance. It is imperative that maintenance-free design and life cycle cost become the basis for selection of all new and replacement machinery, equipment, and systems. This selection process, in conjunction with a comprehensive Total Plant Performance Management program, will provide the means to radically improve total plant performance.

MACHINE

DESIGN

AND SELECTION

The first step required for proper design or selection of critical plant machinery is designing it. Many of the chronic maintenance problems that plague our plants are the direct result of improper design or misapplication of critical machinery. Because many plants have phased out their plant engineering and design functions, few of the critical plant systems are designed in-house. Instead, more and more companies rely on outside contractors to design their critical process systems. Therefore the plant role has been reduced to specification and selection of systems. This dramatically increases the need to ensure that proper and complete evaluation of vendor design equipment, machinery, and systems are included in the total plant improvement program. Normal design, selection, and purchasing practices have limited selection of machinery to initial capital costs (that is, purchase price) and ignored the long-term cost associated with these critical plant systems. This process assumes that all machine or system designs are equal, that all will have the same operating and maintenance costs, and that initial cost is the only factor that should be considered. This simply is not true! Machines are designed for specific operating conditions and will not tolerate long-term operation outside their performance envelope. Historical data indicates that a substantial percentage (27 percent) of all chronic maintenance problems is the direct result of misapplication of critical machines and/or systems.

Equipment Reliability

s3

While complex, integrated systems are prone to misapplication, simplex machines, such as pumps, compressors, and fans, are misapplied more often than not. CENTRIFUGAL

PUMPS

Pump manufacturers provide a variety of centrifugal pumps that will provide long-term, trouble-free service. However, the correct pump must be selected for a specific application. The principal design criteria that should be considered when selecting a pump include hydraulic efficiency, brake horsepower required, net positive suction head (NPSH) required, drive-train configuration, and performance envelope. In many cases, we simply specify that a pump should deliver a flow and pressure required for meeting the known system demand. The specification does not include a minimum efficiency requirement or a performance envelope that will ensure best operating cost or operating life. Little consideration is given to the hydraulic efficiency, p u m p configuration, and performance envelope of the pump. The normal result is a pump that will meet the minimum hydraulic (that is, pressure and flow) requirements but will have high operating and maintenance costs. Selection based strictly on capital costs will result in chronic maintenance problems and higher life cycle costs. All centrifugal pumps are designed to boost inlet (that is, suction) pressure and deliver a range of discharge pressures and flows. In all cases, the pump will follow the hydraulic pressure curve and deliver a volume of liquid (flow) that is determined by the total dynamic pressure (TDH) of the system. In addition, each pump has an optimum performance point (that is, best efficiency point [BEP]) where the maximum pressure, flow, and efficiency can be delivered. Pump selection using the BEP will provide the most reliable, cost-effective life cycle cost. Pumps selected at their B EP will require less brake horsepower (energy) and operate at optimum stability. A direct correlation exists between pump efficiency and the stability of the rotat-

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84

ing element. Instability of the rotor is directly proportional to the deviation from B EP. This increase in instability will reduce the operating life of pump wear parts, mechanical seals, and bearings. The net result is more frequent repairs and downtime. FANS

AND

BLOWERS

Fans and blowers are sources of chronic maintenance problems that are most often created by misapplication. A number of design parameters should be considered when selecting a fan or blower, including critical speed, fan configuration, volume control, and support structures.

Critical Speed All fans and blowers are designed to operate just below their natural frequency (that is, their critical speed). In most cases, the design speed will be within 10 to 15 percent of either the first or second critical speed of the fan. Initially this does not create a serious problem. However, dirt tends to plate-out on the rotating element of the fan or blower. As this accumulation builds, the mass of the rotating element increases. The net result of this increase in mass is a reduction of the critical speed and severe instability of the rotating element. The selection process should clearly define the installed critical speeds of the fan.

Fan Configuration Fans have two basic configurations: overhung and centerline. Overhung, or cantilevered, fans have two support bearings located on one side of the rotating element. In this design, the entire weight of the rotor is outboard of the bearings. Therefore, this type of fan is more prone to instability than the centerline configuration. The overhung fan configuration is not suitable for applications that require volume control to meet variations in system demand.

Equipment Reliability

as

Volume Control When a fan is selected, it should include inlet dampers that will enable the user to adjust the volume and pressure produced by the fan. In many cases, the estimated system head (that is, the back-pressure and the volume requirement) is more or less than the actual system requirements. Without inlet dampers that enable the user to adjust for these errors, the misapplied fan will operate in an unstable condition. The result of this instability will be reduced bearing and rotor life. Support Structures Fan manufacturers do not normally provide sufficient structural support for their fans. In most cases, a formed steel pedestal is the only support for the motor and fan. While adequate for absolutely normal operation, these pedestals cannot dampen any abnormal vibration caused by aerodynamic instability or mechanical problems.

CONCLUSION As has been shown, a plant must address a myriad of reliability issues to propel itself toward optimum performance. It cannot expect its performance to improve until its equipment can be trusted. By the same token, a plant cannot expect to excel unless its organizational structure can be trusted to withstand and support such transformation, as Chapter 5 will show.

Chapter 5

Effective

Organization Organization is people with a purpose working together. Good organization is effective people working constructively t o g e t h e r toward a common goal. There is a dramatic difference between these two statements. Planning a plant and corporate organization is both a science and an art. One portion of the science of organization lies in the dimensions on which organizations are designed. The dimensions of structure, culture, systems, and processes are common to all plants. H o w organizational dimensions are coordinated and governed is more art than science. In no two companies are dimensions combined or managed in the same way. Simply stated, there is neither a clear guideline nor a single, ideal organization structure that is best for all plants or corporations. A fundamental principle of organization is that the pieces or functions must fit together and be able to effectively coordinate between each other. As a system, organizations can only be understood or governed as an integrated total. This view argues that the total is something more than merely the sum of its parts and that analysis of each part, followed by aggregation of the analyses, does not provide an accurate picture of the total or of how the total performs. Just as the human body cannot be understood by examining its subcomponents, such as its circulatory, digestive, and respiratory systems, a 86

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plant organization only has true meaning as a total integrated system. Evaluation of the performances of the engineering, financial, maintenance, and marketing functions of a plant as separate, independent functions cannot provide a characterization of the total plant. Organizations, like individuals, must preserve their integrity. They are built on unique corporate concepts, with the intention of accomplishing a specific purpose or mission. The integrity of organizations is defined in relation to its congruence, symmetry, and fit. It must have a balance between policy and practice, between philosophy and performance, between decisions and deeds. One serious problem that limits plant performance is the fact that many organizations have failed to recognize the interrelationship of plant functions. Within these organizations, each function operates as a separate entity, without any coordination or communication with other plant functions. In 1986, the Society of Manufacturing Engineers examined the balance between current levels of manufacturing technology and company organizations. The conclusion of this study was that American industry, in its drive to become more competitive, is attempting to put fifth-generation technology into second-generation plant organizations. The study also concluded that all forms of advanced manufacturing technology require an organizational form, style, and culture that are attuned with the standards and processes of the plant. The success of the Total Plant Performance Management program depends on the participation and total commitment of all employees within the company. Based on a 1987 survey conducted by the U.S. General Accounting Office, the most common approaches used by domestic industries to gain employee involvement included suggestion systems, information sharing, training, and survey feedback. Although these methods had a positive short-term impact on overall plant performance, the probability that they would provide longterm employee commitment was not very great. Although the intent of the TPPM program is not to increase staff or create an additional management structure, it will require a core group of people who have the authority and responsibility to implement the program. Care should be taken to ensure that this change

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in organization is not perceived as another quick-fix management solution.

THE

TPPM

ORGANIZATION

Because each TPPM program must be custom-tailored for a specific company or plant, there is not a standard organization structure for this type of plant improvement program. The optimum organization structure for your plant should parallel, as much as possible, the existing functional management structure. Within that framework, key personnel should be assigned well-defined tasks, with clearly defined goals and milestones that they are required to achieve to meet program objectives. FUNCTIONAL RESPONSIBILITY

The functional responsibility for the implementation and maintenance of the program must fall equally on each of the functional groups within the company. Purchasing, production, maintenance, accounting, plant engineering, quality control, plant management, and other support divisions within the company must provide full participation. The general responsibilities of various people within the organization include the following.

President a n d C E O The president and/or chief executive officer has the major role in continuous improvement. As the senior officer of the corporation and spokesperson for the board of directors, this person has sole responsibility for the performance of the entire corporation and each of its plants. Therefore, he or she must be the physical, emotional, and spiritual leader of any improvement attempt. At the plant level, the minimum core group required to implement a TPPM program should include the following employees, listed from highest to lowest rank within the organization.

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General Manager Global direction and guidance for the program is the responsibility of the general manager or highest ranking manager in the plant. Goals and objectives established for the program must be compatible with the operating and financial objectives of the plant. Therefore active participation and involvement at the general manager level is absolutely necessary. The general manager has the responsibility of assuring that all facets of the plant management team provide full commitment and support to the program. He or she is also responsible for final approval of the program plan and must periodically evaluate program results. The most critical responsibility of the general manager is the commitment of resources. He must provide the financial and manpower resources required for implementing and maintaining the program. Program Coordinator The program coordinator is directly responsible for the implementation, maintenance, and results tracking of the program. The function is responsible for program direction and day-to-day management of the total plant program. As facilitator, the program coordinator must maintain program continuity across the mill. In addition, he or she is responsible for the development of standards for repetitive maintenance tasks, operating procedures, purchasing practices, machine/system design criteria, and standardized training programs. These tasks will require close coordination with, and the assistance of, purchasing, plant engineering, contracting services, accounting, training, quality control, and the management teams of each division. P r o g r a m Advisor The expertise required for establishing a total plant improvement program may not be available in-house. Therefore you may want to retain the services of a consultant who will provide guidance during the program development phase of the program. The program advi-

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sor will provide definition for a comprehensive program that is specifically designed for the company. The advisor has the specific responsibility of assuring that the program is configured, implemented, and organized in such a manner that the goals and objectives are met. As an outsider, the advisor cannot be responsible for actual implementation or management of the program. His or her function should be limited to providing guidance to the steering committee and program coordinator.

Steering Committee A steering committee, composed of responsible representatives of each division and functional group, will provide overall guidance and review of the program. The primary function of the steering committee is to assure that all facets of the company are equally represented in the program. The committee should include a senior manager from each of the following functions: plant engineering, purchasing, maintenance, quality assurance, training, contracting services, safety, and each of the production divisions. The general manager, with assistance from the program coordinator, should chair the committee. The committee has two primary responsibilities. The first is to establish and approve specific criteria that will be used to develop standard procedures and practices for each of the functional groups within the plant. In addition, the steering committee will have the responsibility of monitoring the program, implementing modifications to its format, and resolving problems or conflicts that may develop.

Division Manager Division managers are responsible for the profitable operation of each production unit and support function within the plant. Because a continuous improvement program is designed to provide each division with the information and technical support required for achieving maximum performance from its areas, the responsibility for the

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program must reside at the division manager level. Therefore each division manager is responsible for the implementation and maintenance of the program within his or her production unit. Each division manager should be assigned to and must accept responsibility for the implementation of the changes that are to be made as part of the program. Implementation of any continuous improvement program, especially one like TPPM that will require radical changes, will not be easy. The division manager is the only one in the division who has the ability to provide the leadership and assure the total commitment needed to make these changes. Every facet of division operation will be impacted. New procedures and methods of operations, maintenance, scheduling, purchasing, and management must be developed and implemented as part of the program. Only division managers can implement the required change in philosophy and attitude within their divisions. Therefore, creation of an environment, within the division, that is conducive to meeting the goals and objectives of the program is the primary responsibility of the division manager. The program cannot achieve its goals and objectives without the total support and participation of each production division. Corrective actions and compliance with standard practices (standard operating procedures [SOPs] and standard maintenance procedures [SMPs]) created as part of the program will not improve the efficiency of the plant unless all division and functional groups act on the recommendations. Program compliance includes upgrade training of division personnel to ensure that all employees are properly trained to operate and maintain process equipment within the standards of a TPPM program. A full course of skills training will be provided by the program, but attendance of division personnel is the responsibility of the division manager. The division manager is the only individual within a division who can ensure total, complete compliance with these changes. Therefore each division manager must be responsible for this critical portion of the total mill program.

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The TPPM program has been developed as a dynamic plan. To achieve optimum benefits, the program will need to be modified on a regular basis to ensure absolute compatibility with the unique requirements of the company. Therefore, the division managers are to provide regular recommendations for modifications or adjustments that would improve benefits of the program within their divisions. The division managers are also responsible for tracking the performance of their divisions and providing a monthly status report to the program coordinator. Each division manager must be totally c o m m i t t e d to the goals and objectives of the TPPM program. Achievement of maximum results from the program is not possible without the total, absolute support of all division managers and their management teams. Each division manager will assign a full-time division coordinator, who has the responsibility of organizing and maintaining the TPPM program within the division. The division coordinator does not have line responsibility for either the production or the maintenance operations within the division. Therefore his or her role is defined as a facilitator or coordinator who provides recommendations to the existing production and maintenance organization within the division. The division coordinator will represent his or her division on the program steering committee. This person is responsible for ensuring that the unique requirements of his or her division are included in the total mill program. He or she is to provide a direct communication link between the committee and the division manager. Each division coordinator will coordinate the development of standard procedures for the division. The program coordinator will provide each division with a common format that will be followed to develop new procedures.

Supervisor Within the guidelines of the program and the directives of the division manager, each supervisor is responsible for ensuring total commitment and compliance with the TPPM program. Supervisors

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must ensure that all employees, within their specific areas of responsibility, understand the program and the specific roles they must play to achieve the goals and objectives of the total mill program.

Production Supervisor These employees are responsible for producing quality products at levels equal to or greater than the business plan for their portions of the division. Because each production supervisor is responsible for a specific, well-defined area within the facility, it is logical that the supervisor should also be responsible for the implementation and maintenance of the Total Plant Performance Management program for his or her area of responsibility. The production supervisors must assume the same responsibilities for their specific areas of the plant as the division managers. Specific responsibilities of the production supervisor include the following: 1. The production supervisors are responsible for creating an environment within their areas that is conducive to the TPPM concept. Because the role of production personnel must be radically changed for the program to achieve maximum benefits, this task of the production supervisor is critical to the program. 2. A full course of skills training will be provided by the program, but attendance of area production personnel is the responsibility of the production supervisor. 3. Communication is critical to success. Therefore it is the responsibility of each production supervisor, or his or her assigned staff, to provide monthly status reports on the progress of the program. The report must be submitted to the division coordinator for inclusion with the division's monthly report. Each monthly status report will include: 9 Implementation of corrective actions recommended for the program. This includes recommended maintenance tasks and changes in operating and maintenance procedures.

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9 Benefits derived from the program. The goal of the TPPM program is to achieve maximum product quality and production capacity at the lowest possible cost. 9 Recommendations for improving the program within the production supervisor's production area.

Maintenance Supervisor These employees have the same program responsibility as the production supervisors. The only difference is they focus on maintaining area machinery, equipment, and systems rather than on production. Operator The TPPM program will change the production worker's role. In the past, operators were responsible for producing specific quantifies of product with little or no involvement in product quality and maintenance of their machinery. Within the scope of the TPPM program, the operator is the key to success. The operators must assume the responsibility for proper operation and maintenance of their machinery, equipment, or process systems. To achieve this goal, production workers must be given training that will provide the basic skills required to produce maximum quantity of quality product without destroying their machinery. Most of the production workers within a given facility do not have the basic skill levels required to meet this goal. Therefore a course of study for each of the critical process areas within the plant should be developed and given to the lead operators. The responsibilities of production workers within the TPPM program include the following: 1. Standard operating procedures for all critical process machinery, equipment, and process systems will be developed as part of this program. Each operator must comply with these procedures. The key to operator compliance is training. The operators must understand how their machines work and the effect of nonstandard operating practices.

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2. The operator is in the ideal place to identify incipient problems within his or her machine. Therefore, the program guidelines formulated by the steering committee and in conjunction with division and production area managers will define specific tasks of each operator that are designed to maintain good operating condition of the critical equipment. 3. It is imperative that any abnormal behavior of critical machinery observed by the operator be reported as quickly as possible. The operator should notify area production management when any abnormal behavior is noticed. All abnormal occurrences should also be entered into an operating log for future reference. ,

,

The operator is also in an ideal position to recommend modifications to the SOPs, machine design, and program plan that will greatly enhance the benefits derived from the plant performance improvement program. Operators should be encouraged to submit suggestions and recommendations. Each operator must continually improve his or her knowledge and understanding of the machinery, equipment, or continuous process system that he or she operates. The training department will develop and make available courses and self-study programs that will provide the knowledge required. It is the employee's responsibility to make use of this material.

Maintenance Mechanic The role of the maintenance mechanic will also change under the program. As in the case of the production worker, maintenance mechanics cannot be content with the methods that have been used in the past. They must accept the new standard maintenance procedures (SMPs) and comply with their methods. The new role of the maintenance employee (both assigned and central) will require training in basic maintenance skills and machine dynamics. Course material will be developed as part of this program to provide both classroom and self-study instruction for the maintenance staff.

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Reliability Engineer The reliability engineering function is charged with the responsibility of improving the operating performance of critical plant manufacturing and production systems. Therefore, the reliability engineer must have a key role in any continuous improvement program. Within the context of a total plant program, the reliability engineer is responsible for regular evaluation of the actual operating performance of all systems within the plant. Part of this responsibility is the implementation and use of a measurement and evaluation program that is capable of accurately defining the actual efficiency and reliability of these systems. In most cases, this type of program will include the use of predictive maintenance technologies, such as vibration analysis, thermography, tribology, and ultrasonic monitoring. In addition, the program should include all process and operating variables that, based on system design, define the system's true condition. Purchasing Agent Contrary to popular belief, the role of purchasing is to support effective utilization of the plant's production systems. The purchasing function must revise its normal low-bid policies and develop a procurement procedure that fully supports optimum plant performance. These changes should include effective methods to ensure timely delivery of the most cost-effective materials, tools, and equipment for both production and maintenance. Plant Engineer Plant engineers must adhere to design and procurement practices that will ensure maintenance-free operation of all critical production systems. The practices must include sound design principles and total adherence to life cycle costs.

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Predictive M a i n t e n a n c e T e a m The predictive maintenance team will provide technical support for the condition-based monitoring portion of the program. Predictive maintenance is a critical part of the program. Information derived from the baseline analysis and routine analysis of the operating condition of critical mill machinery and systems is vital. Without factual knowledge of specific problem areas and/or maintenance requirements, the total mill program cannot succeed. As currently configured, the maintenance team (with the assistance and support of select outside contractors) will provide technical support in the following predictive maintenance areas: vibration analysis, thermography, tribology, machine or process efficiency, visual inspection, and failure analysis. The specific responsibilities of the predictive maintenance team are divided into two sections: program implementation and program maintenance.

Program Implementation Because the Total Plant Performance Management program depends on analysis that is both correct and up-to-date of the operating condition of all significant production and manufacturing equipment, the predictive maintenance team must put together a condition-based monitoring program that will support the goals. During the startup phase of the TPPM program, the team must hire and train a staff of qualified technicians and analysts for each of the predictive maintenance technologies that will be included in the program.

Program Maintenance The primary responsibility of the team will be to provide data acquisition, interpretations, and recommended corrective actions for the condition-based monitoring portion of the total plant program.

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In addition, the team should provide technical support for each area of the plant. This technical support will include alignment, balancing, factory acceptance testing, site acceptance testing, troubleshooting problems, and failure analysis.

TYPICAL TPPM

ORGANIZATION

Although the core group of people that has just been listed is important to the TPPM program, the existing organizational structure will have the ultimate responsibility for it. In a large, integrated process company, the roles within the organization should follow the following guidelines. The president and CEO of the corporation is responsible for delegating the authority for defining, achieving, and sustaining the objectives of the TPPM program to the corporate steering committee. The corporate steering committee will be made up of the executive vice president of raw materials and diversified businesses, the vice president of operations, and the vice president of sales. The corporate steering committee has the overall responsibility for the development, implementation, and maintenance of the TPPM program. The corporate steering committee will have final authority for management review/audit of the TPPM quality system to comply with ISO 9000 requirements. The committee appoints the director of TPPM as the management representative for the TPPM program, and the committee will meet every three months. The executive vice president of raw materials and diversified businesses is a member of the corporate steering committee and has the overall job of production and operations of other diversified businesses, as well as procurements, distribution, and sales. This position also implements and maintains the TPPM program and assures adherence of the company to specified quality standards.

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The vice president of operations is a member of the corporate steering committee and is in charge of the production and operations of the three primary production divisions. Another duty for this position is achieving and sustaining the objectives of the TPPM program. The vice president of sales is a member of the corporate steering committee and makes sure that orders entered on the plant are compatible with customer specifications, mill capabilities, technical society or industry standards, and specified quality requirements. This vice president must ensure that order entry is consistent with the authorized product manual instructions. This position is responsible for assisting and supporting business-planning functions and operations functions in meeting quality, production, and delivery scheduling requirements. This position is also responsible for supporting the efforts and objectives of the sales and marketing function in upgrading facilities to satisfy ongoing and anticipated product and market demands. The executive vice president of commercial is responsible for the overall operation of commercial sales and marketing, for developing product standards, and for supporting business-planning activities. This position takes care of interpreting and clarifying customer order requirements, providing technical support to the customer, and obtaining customer feedback on product quality and services. The vice president of technology and management services is in charge of providing raw materials, consumables, equipment, parts, and all purchased supplies and services, to conform to the specifications of the operating facilities. This position is also responsible for supplying engineering and technical support to achieve the goals and objectives of the TPPM program. The director of TPPM is directly in charge of ensuring that the requirements of the TPPM program manual and ISO standards are developed, implemented, and maintained. The director of TPPM will also be the corporate management representative, appointed by

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the corporate steering committee, and will have overall responsibility for administration, monitoring, and oversight of the TPPM program management review/audit process. The general manager of systems and process control looks after the development of systems that meet the needs of the TPPM program. The general manager of engineering reports to the vice president of technology and management services and takes charge of supplying engineering and technical support to achieve the goals and objectives of the TPPM program, including controlling and verifying the design of the facilities and equipment to meet customer requirements. The general manager of research oversees supplying of technical support to achieve the goals and objectives of the TPPM program. The general manager of marketing and planning is responsible for supporting the efforts and objectives of the sales and marketing function in upgrading facilities to satisfy ongoing and anticipated product and market demands. The general manager of sales has the overall duty of district sales/outside sales, customer service, and customer technical service. The manager of customer technical services reports to the general manager of sales and leads in interpreting and clarifying customer order requirements and developing and issuing a set-up letter to the plants regarding new orders. This position supplies technical support to the customer and provides customer feedback to the operation. The manager of purchasing quality and administration has the responsibility for the development and implementation of the supplier quality process (means of certifying vendors).

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The vice president and general manager looks after the developing, implementing, achieving, and sustaining of the objectives of the TPPM program at the plant level, including appointing the plant management representative. This position is responsible for the following: identifying and planning production; providing the information, resources, and environment necessary to assure effective performance; and communicating the objectives and commitment to ensure that product and process quality requirements are consistently met or exceeded. This position is in charge of developing short- and long-term continuous improvement objectives. In addition, this job includes establishing and maintaining a plant TPPM quality steering team. This team will meet at least every six months as a minimum and will be used as a vehicle for directing the TPPM program within the vice president and general manager's duties. The vice president and general manager position also controls directing and empowering the plant TPPM managers to develop and implement specified elements of the TPPM program. The plant quality assurance manager is responsible for implementing, maintaining, and administering the plant quality assurance functions and activities. This position is in charge of, and shall designate and supervise qualified individuals in, the following: initiating action to prevent the occurrence of nonconforming product; identifying and recording quality problems; and initiating, recommending, and providing solutions to quality problems. This position oversees the following TPPM program items: developing the plant quality procedures and continuous improvement objectives in conjunction with the vice president and general manager; developing inspection procedures, such as in-process and final inspection procedures; and identifying and maintaining quality records. The T P P M division coordinators are in charge of helping to implement and develop specific areas and activities of the TPPM program. They will also be responsible for ensuring that the specified elements of the plant TPPM program are documented in the plant quality procedures. Other duties include coordinating the implemen-

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tation of the elements of the system and making recommendations to the division steering committee; providing ongoing communication to employees, suppliers, and customers regarding TPPM developments; seeking out resources, material, and training to provide growth and maintenance of the system; and reporting the status of system implementation at the plant level. The plant management representative has the defined authority and the job description of ensuring that the requirements of the TPPM program and ISO standards are implemented and maintained. This position will also have responsibility for the administration and oversight of the management review/audit process at the plant level. The plant management representative will have dotted-line, or indirect and functional, reporting responsibility to the director of TPPM for periodic reporting of plant-level management review/audit status. The plant division managers of operations, maintenance, and services are in charge of the quality of the product or services provided by their divisions and the implementation of the TPPM program in their divisions. This position is also required to hold a quarterly TPPM program meeting to address short- and long-term quality objectives. The area managers of operations, maintenance, service, and quality assurance have the shared responsibility for the implementation and documentation of the TPPM program in their areas of duty. Their job requirements are as follows: establishing a system for maintaining the plant facilities, equipment, and property; implementing provisions to control and maintain inspection, measuring, and test equipment; retaining and evaluating the performance data of purchased products and services and feeding those data back to purchasing; assisting in the disposition of nonconforming items; and identifying training requirements for all their employees. In addition, they are encouraged to establish employee involvement teams.

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The shift manager is in charge of the operation of the equipment in accordance with written standards and practices, which entails ensuring that the employees are properly trained in the operation of the equipment and that statistical techniques are properly used when required. In addition, this position also ensures that the product meets the basic standards and specifications and reports on daily operations of the facilities. This position is also responsible for implementing key elements of the TPPM program, identifying key job characteristics, and evaluating employees to determine when they are qualified to perform specific tasks. They are also encouraged to participate in employee involvement teams. The division TPPM steering committees are responsible for overseeing the application of the elements of the TPPM program and for ensuring that they are properly implemented. The employees are in charge of adhering to the established standards and practices and for making quality a top priority. They are encouraged to participate in establishing standard quality practices and in-process standards and to participate in problem-solving teams that identify the root-causes of problems and implement any changes or actions.

CONCLUSION With this organizational structure in place, your plant will be in prime position to elevate its performance t h r o u g h its human resources. But even with the best structure in the world, a plant will not achieve optimum performance if it cannot get its employees integrally involved in the transformational effort, as Chapter 6 will reveal.

Chapter 6

Employee Involvement

Japan's business leaders have characterized American workers as illiterate, lazy, and unable to compete with their offshore counterparts. Most Americans were incensed when these comments were published. How many Americans would be outraged to learn that many corporate managers in America share this belief?. If someone evaluated the management philosophy and attitudes of corporate America, that person would find that many of our corporations treat their work force as though it lacked the intelligence and work ethic required for competing in today's global market. With the exception of a small inner circle of senior managers, many companies exclude employees from the decision-making process. To a great extent, senior management fails to provide enough insight into corporate planning to permit middle management and hourly workers to focus their efforts in a direction that supports the long-range plans of the company. While it is true that the education level of many Americans has declined and that some workers lack the motivation required to effectively produce products that are comparable with those of offshore companies, the blame does not rest totally with the worker. In too many cases, the culture and work environment created by corporate management philosophy and our society does not support a highly motivated work force that is committed to product quality 104

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and competitive production costs. In many cases, the work environment and restrictions imposed by management methods actually prohibit employee involvement and participation. To a great extent, the America work force is frustrated by restrictions imposed by business practices and management methods. Properly motivated and given a working environment that is conducive, the American worker can, and will, produce products equal to or better than any produced offshore. A fundamental premise of optimum plant performance is the realization that the only asset of a company is its employees. Therefore, a prerequisite of optimum plant performance must be the creation of a work environment that is conducive to employee involvement and that will provide the means to effectively utilize the work force. While this may sound like a simple task, it is most difficult to actually accomplish. During the past twenty-five years, America's business philosophies and management methods have slowly eroded to the point that product quality, competitive production costs, on-time delivery, and of course profitability have become almost nonexistent. To reverse this serious negative, we must completely change the corporate culture that has evolved with this erosion. Changing the t h o u g h t processes, ingrained attitudes, and prejudices that have become second nature during the past few decades is not easy. Corporate management cannot decree that its managers and employees will instantaneously reverse habits that have taken years to evolve. H o w then do we effect a change in the work culture? The Japanese and other consultants have espoused two methods to get employees involved in quality manufacturing-improvement and maintenance improvement programs. Their programs are predicated on empowerment and small-group activities.

EMPOWERMENT Much has been written about empowering employees, but few companies understand what the term empowerment means. Many think it means the establishment of small groups or teams that will

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either produce a product or seek to improve product quality. Others think of empowerment as the ability of any employee to stop production when a quality problem is detected. Neither of these definitions is a true representation of what employee e m p o w e r m e n t means. According to Webster's Dictionary, the word empower means "to authorize," "delegate authority to," "to enable," and "to perm i t " ~ i n other words, to give the employees the means and authority to affect the day-to-day operation of the plant. One of the most common corporate management philosophy errors is the failure to delegate the authority to managers, supervisors, and employees that is required to effectively fulfill their roles within the company. Although this error may sound insignificant, it is the greatest single contributor to poor plant performance. Without the authority to manage assets or correct problems that occur on a daily basis, managers cannot effectively control their portions of the plant, and employees cannot take an active role in improving inefficient practices and overall plant performance declines. The second factor that limits most U.S. plants is lack of acceptable employee skill levels to effectively produce a cost-competitive, quality product. Empowerment, in this instance, means to provide the training, tools, and management support that will enable the work force to function effectively.

SMALL-GROUP

ACTIVITIES

Most plant improvement programs emphasize employee involvement; however, the methodology differs from program to program. For example, the Japanese approach uses small-group activities. Their philosophy stresses teams or small groups that are empowered to provide delegated tasks, such as quality improvement or a segment of the manufacturing process. Other management techniques, such as Kepner-Tregoe, stress small-group decision-making methods. Even Edward Deming and Philip Crosby, two established authorities on Japanese management methods, included small-group activities in their approaches to quality improvement. Are these methods valid in American industry?

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Fundamental problems are associated with exclusive small-group activities. Perhaps the most serious is the lack of total involvement of all employees. The degraded work ethic that has become an ingrained part of American society has created a severe problem for our manufacturing and production plants. In this environment, the participation of a small percentage of the total work force in small-group activities cannot reverse the negative impact of l e s s - t h a n - o p t i m u m performance of all employees within the company. The only solution to poor plant performance is the absolute involvement and commitment of all employees within the plant. A second problem with exclusive small-group activities is team composition. Our society has become divided into two basic personality classifications: leaders and followers. A small percentage of our society and the work force of a typical plant is made up of strongwilled individuals who actively lead, but the majority is passive and usually lacks the interest or will to make decisions. The latter group becomes the followers. A direct result of this unfortunate fact is that most of the small groups are dominated by one or two individuals who impart their concepts of what is right for the company, and the followers of the group follow meekly along. A third problem with excessive use of small groups is the time lost in meetings and planning of tasks. In companies that have adopted Japanese management concepts, a tremendous amount of potential productive time is lost in the meeting and planning schedules required to implement and maintain small-group activities. One company reported that 50 percent of its maintenance was performed by outside contractors while its in-house maintenance staff attended total productive maintenance planning meetings. The final problem with exclusive use of small-group activities is the basic concept. Business is not, nor should it be, a democracy. A marked difference exists between empowering or involving employees and allowing them to participate in every decision required for operating a company. Moreover, decisions derived by committee are time consuming and are usually wrong for the long-term benefit of both the company and its employees.

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TOTAL

EMPLOYEE

INVOLVEMENT

If small-group activities and empowerment, as defined by the Japanese, are inappropriate for American companies, what is the best method of integrating total employee involvement into a total plant improvement program? The answer is both simple and extremely difficult. Total employee involvement is the natural result of a work environment that encourages the active participation of each employee in the day-to-day operation of the company. The environment needs to clearly define goals and objectives. It also needs to have stable and uniform direction, trustworthy leadership, a n d ~ m o s t i m p o r t a n t ~ a viable, open communication throughout the organization. This concept sounds easy, and the senior management of most companies truly believes that these conditions exist in its companies. Unfortunately, most companies do not meet any of these criteria and therefore do not have the full support of their work force. IT S T A R T S W I T H S E N I O R M A N A G E M E N T

The key to total employee involvement rests with corporate management. Only the highest level of corporate management can effect the changes in company policy and procedure that are a prerequisite to this critical part of any improvement program. Unfortunately, most corporate managers do not have the knowledge of day-to-day operation, at the plant-floor level, that is required to recognize the limitations and problems that existing management philosophy is causing. Most companies have a serious communication problem. In these companies, a "filter factor" distorts all communication between the employees and corporate management. This means that, much like the parlor game in which a rumor is passed from player to player, each level of management filters communication from the employee as it works its way upward to corporate management. By the time the senior manager receives the message, little of the original message is left. A reverse filter distorts corporate directives as they work downward to the employee. Each level of management imparts its own interpretation of the directive before passing it to the next lower

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level. By the time the directive reaches the employees of the line manager, it has been altered to the point that little of the original intent remains. Senior management's role in the continuous improvement process is critical. Without its total commitment and active participation in the process, little can be accomplished. The following requirements and tasks are the minimum requirements of senior management.

Corporate C o m m i t m e n t The first requirement of total employee involvement is the absolute commitment of corporate management to implement and maintain a management philosophy conducive to optimum plant performance and employee involvement. To accomplish this task, senior management must honestly evaluate its own attitudes and prejudices. Until it acknowledges its own contribution to the lack of employee motivation and poor plant performance, it cannot achieve the level of commitment required to resolve long-standing problems.

Solicitation of Employee Input The second task may be alien in many plants. Senior management must solicit input from the employees and honestly listen to their responses. The floor-level work force and line management, in most cases, know what is required to improve the overall performance within their areas of the plant. If the work force can be convinced that management truly wants their advice, the workers will share their knowledge. Do not expect immediate support from the workers. Most have been conditioned by prior, half-hearted attempts to solicit their involvement and may not believe that management's requests are sincere. However, with time and management's genuine interest in their opinions, most of the workers will respond and take an active part in the plant improvement program. It is imperative that senior management respond to the input and suggestions provided by the work force. Failure to visibly implement corrective actions and to provide logical, honest reasons why certain problems

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cannot be immediately corrected will severely retard, if not destroy, the plant improvement program before it starts.

Communication Full, open communication between all functions in the corporation is a fundamental requirement. The entire work force must be fully aware of the program, its progress, and the work force's own role in the program. This is especially true of c o m m u n i c a t i o n between senior management and the floor-level work force. Specific methods of communication that will eliminate any filtering of data must be implemented during the initial or planning phase of the program. Typically, these methods will include videotapes, newsletters, employee meetings, and plant walk-arounds.

Videotapes Short, well-prepared videotapes can be used to communicate the vision of the CEO and senior management directly to the work force. These tapes should be ten to fifteen minutes in length and carry a clear message that can be easily understood by the entire work force. When preparing these tapes, management should assure that the message is expressed in terms that have meaning to all levels of the work force. For example, few of the floor-level workers will fully understand financial terms, such as return-on-investment, but they will clearly understand goals and objectives expressed in terms of job security.

Newsletters Many plants already use newsletters to communicate with the work force. These can be used effectively to support a continuous improvement program. Articles that explain the program's objectives, progress, successes, and failures can be an effective communication tool. Include articles written by employees. Many of the lower-level personnel in the plant rarely, if ever, have the chance to express their views of the company. Inclusion of employee comments or views can be an extremely effective communication tool. If participation is

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slow, offer a gift certificate or savings bond to encourage employees to get involved.

EmployeeMeetings Even in large plants, regular meetings that involve the entire work force are needed to establish open, honest communication. Guidelines for these meetings must be constructive, not destructive. Management must be open and honest with the employees and must solicit their input. When input is offered, even when it is negative, senior management must listen and honestly respond. Nothing will destroy morale and effective plant performance more than an adversarial relationship between management and the work force. This is especially true in union plants in which there is a long history of mistrust. Plant Walk-arounds Most of the truly successful senior managers allocate a regular part of their busy schedule for informal visits to the plant floor. During these walk-arounds, they talk with employees. In addition, they solicit input from each of these employees and truly listen to their responses. Some senior managers actually make time to personally respond to concerns or questions poised by the employees. This type of one-on-one communication will do more for employee morale and for employees' desire to help improve plant performance than any other single component of a continuous improvement program. When each employee believes he or she has an important role to play, most will redouble their efforts to assure success.

CONCLUSION Undoubtedly, the extent of employee involvement in the work environment has a direct and significant effect on a plant's performance, as it does on that of any company. But what about the technologies more specific to plants in particular? Let's take a look at the mechanical side of TPPM in Chapter 7.

Chapter 7

Operating Dynamics Analysis Effective performance of any manufacturing or process plant is dependent on reliable systems that continuously operate at their best design-performance levels. To achieve and sustain this level of performance, the plant must have an effective way to constantly monitor and evaluate these critical systems. Operating dynamics analysis provides a cost-effective means of accomplishing this fundamental requirement. In the thirty years that I have used this technique to benchmark critical plant systems, the success rate has been almost perfect. This technique has been able to identify and isolate 98 percent of the limiting factors that prevented optimum performance in the thousands of systems that were evaluated. This same concept will work in your plant.

PLANT OPTIMIZATION

TOOL

The focus of an operating dynamics analysis program is on the manufacturing process and production systems that generate plant capacity. It is not a maintenance-management tool, like traditional predictive maintenance programs, which try to foresee problems. Because of perceived technology restrictions, such as low speed and machine complexity, most traditional predictive maintenance pro112

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grams ignore or omit the critical production systems. While there may be some benefit in monitoring auxiliary equipment, maximum benefit can be achieved only when the reliability of the plant's critical production systems is maintained. Within the operating dynamics concept, auxiliary equipment is not ignored, but the focus is on those systems that produce capacity and revenue for the plant.

BENCHMARKING

EQUIPMENT

RELIABILITY

A misconception exists that predictive maintenance tools are only useful for long-term trending of equipment condition. Nothing could be further from the truth. Predictive maintenance technology is an ideal benchmarking tool. While the long-term condition history of plant systems is the cornerstone of predictive maintenance programs, the technologies are not limited to this approach. During the past thirty years, we have used predictive maintenance technologies, especially vibration analysis, as a one-shot diagnostics tool. In most cases, we were limited to a single set of data from a complex machine-train or an entire production system. With this single set of data, we were able to determine incipient problems within the system, isolate all deviations from optimum condition, and recommend cost-effective corrective actions. In other words, we bcnchmarked the system. Do not let me mislead you. Our evaluation was not limited to predictive maintenance technologies. We did not just take a series of vibration signatures, infrared images, and oil samples and use these data in a vacuum to benchmark these systems. Rather, we used the predictive maintenance tools the way they were intended to be used. As in all uses of predictive maintenance technologies, we started with the design specifications of each machine-train and production system. From these data, we were able to calculate the operating dynamics, including vibration profiles, that the system should produce in normal operation. In addition, we evaluated each system to define design weaknesses, the most likely failure modes, and the system's normal range of acceptable operation. Operating procedures were

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checked to make sure they coincided with the designed operating parameters. In other words, we analyzed the machine-train or system so that we had a full understanding of how it was designed to operate. With these data, we measured the actual operating dynamics of each machine-train and system. We used time- and frequencydomain vibration, thermographs, tribology, and a variety of other predictive tools to measure specific parameters that would define the actual dynamics of the production system during normal production. It is imperative that the data include the full range of normal operating conditions, including ramp up and deceleration on variable speed systems. The keys to this type of benchmarking include system design, operating parameters, operating practices, measurement of operating dynamics, and benchmark analysis. SYSTEM DESIGN

Every system was designed to perform specific functions. It is important to fully understand the specific design criteria and limitations of each system. This understanding should include every component that is used within the system. A full failure modes effects analysis (FMEA) is not required, but a detailed understanding is essential to success. OPERATING PARAMETERS

An acceptable range of operating conditions is inherent in every production and manufacturing system. Your evaluation must clearly define this range so that your benchmark measurements can accurately measure the operating dynamics of the system under all operating conditions. In addition, this part of your evaluation will isolate any operating practices that are outside the acceptable design range. Evaluation of the operating parameters should also include variations in product. Many production systems must handle a wide range of incoming and finished product. Your benchmark evaluation must allow for these variations and quantify their impact on system reliability.

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I have found that a large percentage, 27 percent, of chronic machine and system problems is the direct result of operating production systems outside their acceptable design range. This evaluation will help resolve these problems. OPERATING

PRACTICES

Before you measure the operating dynamics of plant systems, you must quantify the variation in actual operating practices. Special attention should be given to the standard practices that ensure they, themselves, are compatible with system design. In addition, variations between crews or shifts should be determined. MEASUREMENT

OF O P E R A T I N G

DYNAMICS

With the data base developed in the preceding steps, measure the actual dynamics of the systems. Predictive tools, such as vibration signatures, are important, but you should include all parameters that define the operating condition of the process. Typically, these data should include all parameters used to control the system (that is, pressure, temperatures, flows, and retention time). BENCHMARK

ANALYSIS

The data, recorded under the full range of normal operating conditions, will quantify the system's operating condition, system reliability, and projected remaining life. The data will identify any deviation from optimum operating condition, as well as isolate any incipient problems that may be present within the system. The benchmark evaluation is inclusive. It will identify and isolate problems that result from design limitations, operating practices, maintenance practices, and product variations. With the information derived from the analysis, cost-effective corrective actions can be developed that will ensure optimum, long-term performance from each production system.

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IT~S N O T J U S T

PREDICTIVE

MAINTENANCE

Prevention of catastrophic failure, the primary focus of predictive maintenance, is important, but programs that are restricted to this one goal will not improve equipment reliability, nor will they provide sufficient benefits to justify their continuance. By shifting the focus to a plant optimization tool that concentrates on capacity and reliability improvements, an operating dynamics program can greatly improve benefits to the company. Predictive maintenance technologies can, and should, be used as a total plant performance tool. When used correctly, these tools can provide the means to eliminate most of the factors that limit plant performance. To achieve this expanded role, the predictive maintenance program must be developed with clear goals and objectives that permit maximum utilization of the technologies. The program must be able to cross organizational boundaries and not be limited to the maintenance function. Every function within the plant affects equipment reliability and performance, and the predictive maintenance program must address all these influences.

LIMITATIONS

OF PREDICTIVE

MAINTENANCE

Vibration monitoring and analysis is the most common of the predictive maintenance technologies. It is also the most underutilized of these tools. Most vibration-based predictive maintenance programs use less than 1 percent of the power that this technology provides. The following are limitations found in predictive maintenance work. TECHNOLOGY LIMITATIONS Most predictive maintenance programs are severely restricted to a small population of plant equipment and systems. For example, vibration-based programs are generally restricted to simple, rotating machinery, like fans, pumps, and compressors. Thermography is typically restricted to electrical switchgear and related electrical equip-

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ment. These restrictions are thought to be physical limitations of the predictive technologies. In truth, they are not. Predictive instrumentation has the ability to effectively acquire accurate data from almost any manufacturing or process system. Restrictions, such as low speed, are purely artificial. Not only can many of the vibration meters record data at low speeds, they can also be used to acquire most process variables, such as temperature, pressure, and flow. Because most vibration meters have the ability to convert any proportional electrical signal into user-selected engineering units, they are in fact multimeters that can be used as part of a comprehensive process performance analysis program. LIMITATION

TO M A I N T E N A N C E

ISSUES

From its inception, predictive maintenance has been perceived as a maintenance improvement tool. Its sole purpose was, and is, to prevent catastrophic failure of plant equipment. While it is capable of providing the diagnostic data required for meeting this goal, limiting these data solely to this task will not improve overall plant performance. When predictive programs are limited to the traditional maintenance function, predictive maintenance must ignore those issues or contributors that directly affect equipment reliability. Outside factors, such as poor operating practices, are totally ignored. SIMPLIFIED

DIAGNOSTIC

LOGIC

Many predictive maintenance programs are limited to simple trending of vibration, infrared, or lubricating oil data. The perception that a radical change in the relative values is indicative of a corresponding change in equipment condition is valid. However, this logic does not go far enough. The predictive analyst must understand the true meaning of a change in one or more of these relative values. If a compressor's vibration level doubles, what does the change really mean? It may mean that serious mechanical damage has occurred but could simply mean the compressor's load has been reduced.

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A machine or process system is much like the human body. It generates a variety of signals, like a heartbeat, that defines its physical condition. In a traditional predictive maintenance program, the analyst evaluates one or a few of these signals as part of his or her determination of condition. For example, he or she may analyze the vibration profile, or heartbeat, of the machine. Although this approach has some merit, it cannot provide a complete understanding of the machine or system's true operating condition. When doctors evaluate their patients, they use all the body's signals to diagnose an illness. Instead of relying only on patients' heartbeats, doctors also use blood tests, temperature, urine composition, brain-wave patterns, and a variety of other measurements of the body's condition. In other words, doctors use all the measurable indices of the patients' conditions. These data are then compared to the benchmark, or normal profile, for the human body. Operating dynamics is much like the physician's approach. It uses all the indices that quantify the operating condition of a machinetrain or process system and evaluates all the components using a design benchmark that defines normal for the system. INFLUENCE

OF P R O C E S S V A R I A B L E S

In many cases, the vibration-monitoring program isolates each machine-train or a component of a machine-train and ignores its system. This approach results in two major limitations: (1) it ignores efficiency and effectiveness of the machine-train, and (2) variations influence the process. The first limitation is when the diagnostic logic is limited to common failure modes, such as imbalance and misalignment, the benefits derived from vibration analyses are severely restricted. Diagnostic logic should include the total operating effectiveness and efficiency of each machine-train as a part of its total system. For example, a centrifugal pump installed as part of a larger system has the function of reliably delivering, with the lowest operating costs, a specific volume of liquid and a specific pressure to the larger system. Few programs consider this fundamental requirement of the

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pump. Instead, their total focus is on the mechanical condition of the pump and its driver. The second limitation to many vibration programs is that the analyst ignores the influence of the system on a machine-train's vibration profile. All machine-trains are affected by system variations, no matter how simple or complex. For example, a vibration profile acquired from a centrifugal compressor operating at 100 percent load compared with a profile from one operating at 50 percent load will clearly be different. The amplitude of all rotational frequency components will increase by as much as four times at 50 percent load. Why? Simply because there is more freedom of movement at the lower load. As part of the compressor design, load was used to stabilize the rotor. The designer balanced the centrifugal and centripetal forces within the compressor based on the design load (100 percent). When the compressor is operated at reduced or excessive loads, the rotor becomes unbalanced because the internal forces are no longer equal. In addition, the spring constant of the rotor-bearing support structure also changes with load. It becomes weaker as load is reduced and stronger as it is increased. In more complex systems, such as paper mills and other continuous process lines, the impact of the production process is much more severe. The variation in incoming product, line speeds, tensions, and a variety of other variables directly impacts the operating dynamics of the system and all its components. The vibration profiles generated by these system components also vary with the change in the production variables. The vibration analyst must adjust for these changes before the technology can be truly beneficial as either a maintenance-scheduling or plant-improvement tool. I M P A C T OF O P E R A T I N G

PRACTICES

Because most predictive maintenance programs are established as maintenance tools, they ignore the impact of operating procedures and practices on the dynamics of system components. Variables such as ramp rate, startup and shutdown practices, and an infinite variety of other operator-controlled variables have a direct impact on both

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reliability and the vibration profiles generated by system components. It is difficult, if not impossible, to accurately detect, isolate, and identify incipient problems without clearly understanding these influences. The predictive maintenance program should do the following things: evaluate existing operating practices; quantify their impact on equipment reliability, effectiveness, and costs; and provide recommended modifications to these practices that will improve overall performance of the production system. TRAINING LIMITATIONS

In general, predictive maintenance analysts receive between five and twenty-five days of training as part of the initial startup cost. This training is limited to three to five days of predictive system training by the system vendor and about five days of vibration, or infrared, technology training. In too many cases, little additional training is provided. Analysts are expected to teach themselves or to network with other analysts to master their trade. This level of training is not enough to gain minimal benefits from predictive maintenance. Vendor training is usually limited to use of the system and provides little, if any, practical technology training. The technology courses currently available are of limited value. Most are limited to common failure modes and do not include any training in machine design or machine dynamics. Instead, the analysts are taught to identiff/simple failure modes of generic machine-trains. To be effective, predictive analysts must have a thorough knowledge of machine/system design and machine dynamics. This knowledge provides the minimum base required to effectively use predictive maintenance technologies. Typically, a graduate mechanical engineer can master this basic knowledge of machine design, machine dynamics, and proper use of predictive tools in about thirteen weeks of classroom training. Non-engineers with good mechanical aptitude will need twenty-six or more weeks of formal training.

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DESIGN

Every machine and process system is designed to perform a specific function or range of functions. To use operating dynamics analysis, one must first fully understand how machines and process systems perform their work. This understanding must start with a thorough design review that identifies the criteria that were used to design a machine and its installed system. In addition, the analyst must also understand the inherent weaknesses and potential failure modes of these systems. UNDERSTAND

DESIGN CRITERIA

A full understanding of the criteria used to design a machine is essential. For example, consider the centrifugal pump. Centrifugal pumps are highly susceptible to variations in process parameters, such as suction pressure, specific gravity of the pumped liquid, backpressure induced by control valves, and changes in demand volume. Therefore, the dominant reasons for centrifugal pump failures are usually process-related. FACTORS THAT DETERMINE

PERFORMANCE

Several factors dominate pump performance and reliability: internal configuration, suction condition, total dynamic pressure or head, hydraulic curve, brake horsepower, installation, and operating methods. These factors must be understood and used to evaluate any centrifugal-pump-related problem or event. Each machine and system has an operating envelope that defines its ability to successfully fulfill its designed function. The operating envelope is bound by input and output conditions that surround the unit. Within this envelope, these factors determine its performance. The variables differ depending on the type of machine and the specific application but are common to all machines and process systems.

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Centrifugal pump performance is primarily controlled by the following two variables: suction conditions and total system pressure or head requirement. Total system pressure is composed of the total vertical lift or elevation change, friction losses in the piping, and flow restrictions caused by the process. Let's take a closer look at all these factors that play a role in determining performance.

Configuration Each machine and system is composed of component parts designed to work together to provide the specific function of the complete unit. In most cases, more than one configuration of these components can be used in the machine. Reliability of the system will depend on the actual configuration selected for a particular application. For example, all centrifugal pumps are not alike. Variations in the internal configuration occur in the impeller type and orientation. These variations have a direct impact on a pump's stability, useful fife, and performance characteristics.

Impeller Type A variety of impeller types are used in centrifugal pumps. Types of impellers range from simple, radial-flow, open designs to complex, variable-pitch, high-volume, enclosed designs. Each of these types is designed to perform a specific function and should be selected with care. In relatively small general-purpose pumps, the impellers are normally designed to provide radial flow, and the choices are limited to either enclosed or open design. Enclosed impellers are cast with the vanes fully encased between two disks. This type of impeller is generally used for clean, solid-free liquids. It has a much higher efficiency than the open design. Open impellers have only one disk, and the opposite side of the vanes is open to the liquid. Because of its lower efficiency, this design is limited to applications in which slurries a n d / o r solids are an integral part of the liquid.

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Impeller Orientation In single-stage centrifugal pumps, impeller orientation is fixed and is not a factor in pump performance. However, it must be carefully considered in multistage pumps, which are available in two configurations: inline and opposed. Inline configurations have all impellers facing in the same direction. As a result, the total differential pressure between the discharge and inlet is axially applied to the rotating element toward the outboard bearing. Because of this configuration, inline pumps are highly susceptible to changes in the operating envelope. Because of the tremendous axial pressures created by the inline design, these pumps must have a positive means of limiting end play, or axial movement, of the rotating element. Normally, one of two methods is used to fix or limit axial movement: either (1) a large thrust bearing is installed at the outboard end of the pump to restrict movement, or (2) discharge pressure is vented to a piston mounted on the outboard end of the shaft. Method No. 1 relies on the holding strength of the thrust bearing to absorb energy generated by the pump's differential pressure. If the process is reasonably stable, this design approach is valid and should provide relatively trouble-free service life. However, this design cannot tolerate any radical or repeated variation in its operating envelope. Any change in the differential pressure or transient burst of energy generated by flow change will overload the thrust bearing, which may result in instantaneous failure. Method No. 2 uses a bypass stream of pumped fluid at full discharge pressure to compensate for the axial load on the rotating element. Although this design is more tolerant of process variations, it cannot compensate for repeated, instantaneous changes in demand, volume, or pressure. Multistage pumps that use opposed impellers are much more stable and can tolerate a broader range of process variables than those with an inline configuration. In the opposed-impeller design, sets of

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impellers are mounted back-to-back on the shaft. As a result, the second impeller cancels the thrust or axial force generated by one of the impeller pairs. This design approach virtually eliminates axial forces. As a result, the pump does not require a massive thrust bearing or balancing piston to fix the axial position of the shaft and rotating element. Because the axial forces are balanced, this impeller type of pump is much more tolerant of changes in flow and differential pressure than the inline design. However, it is not immune to process instability or to the transient forces caused by frequent radical changes in the operating envelope. Suction Conditions Factors affecting suction conditions are the net positive suction head (NPSH), suction volume, and entrained air or gas. Net Positive Suction Head

Suction pressure, called net positive suction head (or NPSH), is one of the major factors governing pump performance. Centrifugal pumps must have a minimum amount of consistent and constant positive pressure at the eye of their impellers. If this suction pressure is not available, the pump will be unable to transfer liquid. The suction supply can be open and below the pump's centerline, but the atmospheric pressure must be greater than the pressure required to lift the liquid to the impeller eye and to provide the minimum NPSH required for proper pump operation. At sea level, atmospheric pressure generates a pressure of 14.7 pounds per square inch (psi) to the surface of the supply liquid. This pressure minus vapor pressure, friction loss, velocity head, and static lift must be enough to provide the minimum NPSH requirements of the pump. These requirements vary with the volume of liquid transferred by the pump. Most pump curves provide the minimum NPSH required for various flow conditions. This information, which is generally labeled NPSHR, is generally presented as a rising curve located near the bot-

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tom of the hydraulic curve. The data are usually expressed in "feet of head" rather than psi. To convert from psi to feet of head for water, multiply by 2.31. For example, 14.7 psi is 14.7 times 2.31, or 33.957, feet of head. To convert feet of head to psi, multiply the total feet of head by 0.4331. Suction Volume

The pump's supply system must provide a consistent volume of single-phase liquid equal to or greater than the volume delivered by the pump. To accomplish this, the suction supply should have relatively constant volume and properties (such as pressure, temperature, and specific gravity). Special attention must be paid in applications where the liquid has variable physical properties (such as specific gravity, density, and viscosity). As the suction supply's properties vary, effective pump performance and reliability will be adversely affected. In applications where two or more pumps operate within the same system, special attention must be given to the suction flow requirements. Generally, these applications can be divided into two classifications: pumps in series and pumps in parallel. E n t r a i n e d A i r or Gas

Most pumps are designed to handle single-phase liquids within a limited range of specific gravities or viscosities. Entrainment of gases, such as air and steam, has an adverse effect on both the pump's efficiency and its useful operating life. This is one form of cavitation, which is a common failure mode of centrifugal pumps. The typical causes of cavitation are (1) leaks in suction piping and valves and (2) a change of phase induced by liquid temperature or suction pressure deviations. As an example, a l-lb. suction pressure change in a boiler-feed application may permit the deaerator-supplied water to flash into steam. The introduction of a two-phase mixture of hot water and steam into the pump causes accelerated wear, instability, loss of pump performance, and chronic failure problems.

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Total System Head Centrifugal pump performance is controlled by the total system head (TSH) requirement, unlike positive displacement pumps. TSH is defined as the total pressure required for overcoming all resistance at a given flow. This value includes all vertical lift, friction loss, and back-pressure generated by the entire system. It determines the efficiency, discharge volume, and stability of the pump.

Total Dynamic Head Total dynamic head (TDH) is the difference between the discharge pressure and suction pressure of a centrifugal pump. These hydraulic curves represent the performance that can be expected for a particular pump under specific operating conditions. For example, a pump having a discharge pressure of 100 psig and a positive pressure of 10 psig at the suction will have a T D H of 90 psig.

Hydraulic C u r v e Most pump hydraulic curves define pressure to be T D H rather than actual discharge pressure. This is an important consideration when evaluating pump problems. For example, a variation in suction pressure has a measurable impact on both discharge pressure and volume. The best operating point for any centrifugal pump is called the best efficiency point (BEP). This is the point on the curve at which the pump delivers the best combination of pressure and flow. In addition, the B EP defines the point that provides the most stable pump operation with the lowest power consumption and longest maintenance-free service life. In any installation, the pump will always operate at the point where its T D H equals the TSH. When selecting a pump, it is hoped that the BEP is near the required flow where the T D H equals TSH on the curve. If it is not, there will be some operating-cost penalty as a result of the pump's inefficiency. This is often unavoidable because

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pump selection is determined by what is available commercially as opposed to by which pump would provide the best theoretical performance. F r o m an operating-dynamic standpoint, a centrifugal p u m p becomes more and more unstable as the hydraulic point moves away from the BEE As a result, the normal service life decreases, and the potential for premature failure of the pump or its components increases. A centrifugal pump should not be operated outside the efficiency range shown by the bands on its hydraulic curve. If the pump is operated to the left of the minimum recommended efficiency point, it may not discharge enough liquid to dissipate the heat generated by the pumping operation. This can result in a heat buildup within the pump that can result in catastrophic failure. This operating condition, which is called shut-off, is a leading cause of premature pump failure. When the pump operates to the right of the last recommended efficiency point, it tends to overspeed and become extremely unstable. This operating condition, which is called run-out, also can result in accelerated wear and premature failure.

Brake Horsepower Brake horsepower (BHP) refers to the amount of motor horsepower required for proper pump operation. The hydraulic curve for each type of centrifugal pump reflects its performance (that is, flow and head) at various BHPs. The B HP required by a centrifugal pump can be easily calculated by: Brake Horsepower = Flow (gpm) x Specific Gravity x Total Dynamic Head (ft) 3,960 x Efficiency With two exceptions, the certified hydraulic curve for any centrifugal pump provides the data required for calculating the actual brake horsepower. Those exceptions are specific gravity and T D H .

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Specific gravity must be determined for the specific liquid being pumped. For example, water has a specific gravity of 1.0. Most other clear liquids have a specific gravity of less than 1.0. Slurries and other liquids that contain solids or are highly viscous materials generally have a higher specific gravity. Reference books, like Ingersoll-Rand's Cameron Hydraulic Data Book, provide these values for many liquids. The T D H can be directly measured for any application using two calibrated pressure gauges. Install one gauge in the suction inlet of the pump and the other on the discharge. The difference between these two readings is TDH. With the actual TDH, flow can be determined directly from the hydraulic curve. Simply locate the measured pressure on the hydraulic curve by drawing a horizontal line from the vertical axis (that is, T D H ) to a point where it intersects the curve. From the intersection point, draw a vertical line downward to the horizontal axis (that is, flow). This provides an accurate flow rate for the pump. The intersection point also provides the pump's efficiency for that specific point. Because the intersection may not fall exactly on one of the efficiency curves, some approximation may be required.

Installation Improper or inadequate installation is a dominant source of equipment reliability problems. Therefore an analyst using operating dynamics analysis must have a complete understanding of the installation requirements of all machinery and systems in the plant. Again using centrifugal pumps as an example, proper installation must consider the following issues: 1. Centrifugal pump installation should follow Hydraulic Institute Standards, which provide specific guidelines to prevent distortion of the pump and its baseplate. 2. Distortions can result in premature wear, loss of performance, and catastrophic failure.

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3. The following should be evaluated as part of a root-cause failure analysis: foundation, piping support, and inlet and discharge piping configurations. Foundation

Centrifugal pumps require a rigid foundation that prevents torsional or linear movement of the pump and its baseplate. In most cases, this type of pump is mounted on a concrete pad that has enough mass to securely support the baseplate, which has a series of m o u n t i n g holes. Depending on size, there may be three to six mounting points on each side. The baseplate must be securely bolted to the concrete foundation at all these points. One common installation error is to leave out the center baseplate lag bolts. This permits the baseplate to flex with the torsional load generated by the pump.

Piping Support Pipe strain causes the pump casing to deform and results in premature wear a n d / o r failure. Therefore, both suction and discharge piping must be adequately supported to prevent strain. In addition, flexible isolator c o n n e c t o r s should be used on b o t h suction and discharge pipes to ensure proper operation. Inlet-Piping Configuration. Centrifugal pumps are highly susceptible to turbulent flow. The Hydraulic Institute provides guidelines for piping configurations that are specifically designed to ensure laminar flow of the liquid as it enters the pump. As a general rule, the suction pipe should provide a straight, unrestricted run that is six times the inlet diameter of the pump. Installations that have sharp turns, shut-off or flow-control valves, or undersized pipe on the suction side of the pump are prone to chronic performance problems. Such deviations from good engineering practices result in turbulent suction flow and cause hydraulic instability that severely restricts pump performance.

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D i s c h a r g e - P i p i n g C o n f i g u r a t i o n . The restrictions on discharge piping are not as critical as those for suction (inlet) piping, but using good engineering practices ensures longer life and trouble-free operation of the pump. The primary considerations that govern discharge-piping design are friction losses and total vertical lift or elevation change. The combination of these two factors is called total system head (TSH), which represents the total force the pump must overcome to perform properly. If the system is designed properly, the discharge pressure of the pump will be slightly higher than the TSH at the desired flow rate. In most applications, it is relatively straightforward to confirm the total elevation change of the pumped liquid: Measure all vertical rises and drops in the discharge piping, and then calculate the total difference between the pump's centerline and the final delivery point. Determining the total friction loss, however, is not as simple. Friction loss is caused by a number of factors and all depend on the flow velocity generated by the pump. The major sources of friction loss include: 9 Friction between the pumped liquid and the sidewalls of the pipe 9 Valves, elbows, and other mechanical flow restrictions 9 Other flow restrictions, such as back-pressure created by the weight of liquid in the delivery storage tank or resistance within the system component that uses the pumped liquid. A number of reference books, such as Ingersoll-Rand's Cameron Hydraulic Data Book, provide the pipe friction losses for common pipes under various flow conditions. Generally, data tables define the approximate losses in terms of specific pipe lengths or runs. Friction loss can be approximated by measuring the total run length of each pipe size used in the discharge system, dividing the total by the equivalent length used in the table, and multiplying the result by the friction loss given in the table. Each time the flow is interrupted by a change of direction, a restriction caused by valving, or a change in pipe diameter, a substan-

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tial increase in the flow resistance of the piping occurs. The actual amount of this increase depends on the nature of the restriction. For example, a short-radius elbow creates much more resistance than a long-radius elbow; a ball valve's resistance is much greater than a gate valve's; and the resistance from a pipe-size reduction of 4 in. will be greater than for a 1-in. reduction. Reference tables are available in hydraulics handbooks that provide the relative values for each of the major sources of friction loss. As in the friction tables mentioned above, these tables often provide the friction loss as equivalent runs of straight pipe. In some cases, friction losses are difficult to quantify. If the pumped liquid is delivered to an intermediate storage tank, the configuration of the tank's inlet determines if it adds to the system pressure. If the inlet is on or near the top, the tank will add no backpressure. However, if the inlet is below the normal liquid level, the total height of liquid above the inlet must be added to the total system head. In applications where the liquid is used directly by one or more system components, the contribution of these components to the total system head may be difficult to calculate. In some cases, the vendor's manual or the original design documentation will provide this information. If these data are not available, then the friction losses and back-pressure need to be measured or an over-capacity pump selected for service based on a conservative estimate.

Operating Methods Normally, little consideration is given to operating practices for centrifugal pumps. However, some critical practices must be followed, such as using proper startup procedures, using proper bypass operations, and operating under stable conditions.

Startup Procedures Centrifugal pumps should always be started with the discharge valve closed. As soon as the pump is activated, the valve should be slowly opened to its full-open position.

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The only exception to this rule is when there is positive back-pressure on the pump at startup. Without adequate back-pressure, the pump will absorb a substantial torsional load during the initial startup sequence. The normal tendency is to overspeed because there is no resistance on the impeller.

Bypass Operation Many pump applications include a bypass loop intended to prevent deadheading (pumping against a closed discharge). Most bypass loops consist of a metered orifice inserted in the bypass piping to permit a minimal flow of liquid. In many cases, the flow permitted by these metered orifices is not sufficient to dissipate the heat generated by the pump or to permit stable pump operation. If a bypass loop is used, it must provide sufficient flow to assure reliable pump operation. The bypass should provide sufficient volume to permit the pump to operate within its designed operating envelope. This envelope is bound by the efficiency curves included on the pump's hydraulic curve, which provides the minimum flow required for meeting this requirement.

Stable Operating Conditions Centrifugal pumps cannot absorb constant, rapid changes in operating environment. For example, frequent cycling between fullflow and noflow assures premature failure of any centrifugal pump. The radical surge of back-pressure generated by rapidly closing a discharge valve, referred to as hydraulic hammer, generates an instantaneous shock load that can literally tear the pump from its piping and foundation. In applications where frequent changes in flow d e m a n d are required, the pump system must be protected from such transients. Two methods can be used to protect the system.

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9 Slow down the transient. Instead of instant valve closing, throttle the system for a longer time interval. This will reduce the potential for hydraulic hammer and prolong pump life. 9 Install proportioning valves. For applications where frequent and radical flow swings are necessary, the best protection is to install a pair of proportioning valves that have inverse logic. The primary valve controls flow to the process. The second controls flow to a full-flow bypass. Because of inverse logic, the second valve will open in direct proportion as the primary valve closes, keeping the flow from the pump nearly constant. DESIGN

LIMITATIONS

Centrifugal pumps can be divided into two basic types: end suction and horizontal splitcase. These two major classifications can be broken further into single-stage pumps and multistage pumps. Each of these classifications has common monitoring parameters, but each also has unique features that alter its forcing functions and the resultant vibration profile. The common monitoring parameters for all centrifugal pumps include axial thrusting, vane-pass, and running speed. Axial

Thrusting

End-suction and multistage pumps with inline impellers are prone to excessive axial thrusting. In the end-suction pump, the centerline axial inlet configuration is the primary source of thrust. Restrictions in the suction piping, or low suction pressures, create a strong imbalance that forces the rotating element toward the inlet. Multistage pumps with inline impellers generate a strong axial force on the outboard end of themselves. Most of these pumps have oversized thrust bearings (such as Kingsbury bearings) that restrict the amount of axial movement. However, bearing wear caused by constant rotor thrusting is a dominant failure mode. Monitoring of the axial movement of the shaft should be done whenever possible.

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Hydraulic Instability (Vane-pass and Running Speed) Hydraulic or flow instability is common in centrifugal pumps. In addition to the restrictions of the suction and discharge discussed previously, the piping configuration in many applications creates instability. Although flow through the pump should be laminar, sharp turns or other restrictions in the inlet piping can create turbulent flow conditions. The forcing of functions such as these results in hydraulic instability, which displaces the rotating element within the pump. In a vibration analysis, hydraulic instability is displayed at the vanepass frequency of the pump's impeller. Vane-pass frequency is equal to the number of vanes in the impeller multiplied by the actual running speed of the shaft. Therefore, a narrowband window should be established to monitor the vane-pass frequency of all centrifugal pumps.

ACQUIRING

VIBRATION

DATA

The location of m e a s u r e m e n t points for centrifugal pumps depends on whether the pump is classified as end suction or horizontal splitcase.

INTERPRETING

OPERATING

DYNAMICS

Operating dynamics analysis must be based on the design and dynamics of the specific machine or system. Data must include all parameters that define the actual operating condition of that system. In most cases, these data will include full, high-resolution vibration data, incoming product characteristics, all pertinent process data, and actual operating control parameters.

V I B R A T I O N DATA For steady-state operation, high-resolution, single-channel vibration data can be used to evaluate a system's operating dynamics. If

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the system is subject to variables, such as incoming production, operator control inputs, and changes in speed or load, multichannel, realtime data may be required to properly evaluate the system. In addition, in systems that rely on timing or have components in which response time or response characteristics are critical to the process, these data should be augmented with time-domain vibration data.

Data Normalization In all cases, vibration data must be normalized to ensure proper interpretation. Without a clear understanding of the actual operating envelope that was present when the vibration data was acquired, it is nearly impossible to interpret the data. Normalization is required to eliminate the effects of process changes in the vibration profiles. At a minimum, each data set must be normalized for speed, load, and the other standard process variables. Normalization allows the use of trending techniques (the comparison of a series of profiles generated over time). Regardless of the machine's operating conditions, the frequency components should occur at the same location when comparing normalized data for a machine. Normalization allows the location of frequency components to be expressed as an integer multiple of shaft running speed, although fractions sometimes result. For example, gearmesh frequency locations are generally integer multiples (such as 5X and 10X) and bearing-frequency locations are generally non-integer multiples (for example, 0.5X and 1.5X). Plotting the vibration signature in multiples of running speed quickly differentiates the unique frequencies that are generated by bearings from those generated by gears, blades, and other components that are integers of running speed. As a minimum, the vibration data must be normalized to correct for changes in the following areas.

Speed When normalizing data for speed, all machines should be considered to be variable-speed~even those classified as constant-speed.

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Speed changes because of load occur even with simple constantspeed machine-trains, such as electric-motor-driven centrifugal pumps. Generally, the change is relatively minor (between 5 to 15 percent), but it is enough to affect diagnostic accuracy. This variation in speed is enough to distort vibration signatures, which can lead to improper diagnosis. With constant-speed machines, an analyst's normal tendency is to normalize speed to the default speed used in the data-base set-up. However, this practice can introduce enough error to distort the results of the analysis because the default speed is usually an average value from the manufacturer. For example, a motor may have been assigned a speed of 1,780 rpm during set-up. The analyst then assumes that all data sets were acquired at this speed. In actual practice, however, the motor's speed could vary the full range between locked rotor speed (that is, maximum load) to synchronous (that is, no-load) speed. In this example, the range could be between 1,750 rpm and 1,800 rpm, a difference of 50 rpm. This variation is enough to distort data normalized to 1,780 rpm. Therefore, it is necessary to normalize each data set to the actual operating speed that occurs during data acquisition rather than using the default speed from the data base. Take care when using the vibration-analysis software provided with most microprocessor-based systems to determine the machine speed to use for data normalization. In particular, do not obtain the machine speed value from a display-screen (that is, on-screen or print-screen) plot generated by a microprocessor-based vibrationanalysis software program. Because the cursor position does not represent the true frequency of displayed peaks, the machine speed cannot be used. The displayed cursor position is an average value. The graphics packages in most of the programs use an average of four to five data points to plot each visible peak. This technique is acceptable for most data-analysis purposes but can skew the results if used to normalize the data. The approximate machine speed obtained from such a plot is usually within 10 percent of the actual value, which is not accurate enough to be used for speed normalization. Instead, use

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the peak search algorithm and print out the actual peaks and associated speeds. Load

Data also must be normalized for variations in load. Where speed variations result in a fight or left shift of the frequency components, variations in load will change the amplitude. For example, the vibration amplitude of a centrifugal compressor taken at 100 percent load is substantially lower than the vibration amplitude in the same compressor operating at 50 percent load. In addition, the effect of load variation is not linear. In other words, the change in overall vibration energy does not change by 50 percent with a corresponding 50 percent load variation. Instead, it tends to follow more of a quadratic relationship. A 50-percent load variation can create a 200-percent, or a factor of four, change in vibration energy. None of the comparative trending or diagnostic techniques used by traditional vibration analysis can be used on variable-load machine-trains without first normalizing the data. Again, because even machines classified as constant-load operate in a variable-load condition, it is good practice to normalize all data to compensate for load variations, utilizing the proper relationship for the application. Other Process Variables

Other variations in a process or system have a direct effect on the operating dynamics and vibration profile of the machinery. In addition to changes in speed and load, other process variables affect the stability of the rotating elements, induce abnormal distribution of loads, and cause a variety of other abnormalities that directly impact diagnostics. Therefore, each acquired data set should include a full description of the machine-train and process system parameters. As an example, abnormal strip tension or traction in a continuousprocess line changes the load distribution on the process rolls that transport a strip through the line. This abnormal loading induces a

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form of misalignment that is visible in the roll and its drive-train's vibration profile. SHAFT DEFLECTION

Analysis of shaft deflection is a fundamental diagnostic tool. If the analyst can establish the specific direction and approximate severity of shaft displacement, it is much easier to isolate the forcing function. For example, when the discharge valve on an end-suction centrifugal pump is restricted, the pump's shaft is displaced in a direction opposite to the discharge volute. Such deflection is caused by the back-pressure generated by the partially closed valve. Most of the failure modes and abnormal operating dynamics that affect machine reliability force the shaft from its true centerline. By using commonshaft diagnostics, the analyst can detect deviations from normal operating condition and isolate the probable forcing function.

CONCLUSION

Without a reliable way to keep a close watch on a plant's critical machinery, it would be difficult to make much progress toward improvement~or even to know if the plant was improving. But in an even greater way, without employees who are trained to keep an eye on the various aspects of a plant, the valuable information provided by operating dynamics analysis would be of little use.

Chapter 8

Train, Train, and Retrain

Training is critical to all continuous improvement programs. It is especially important in any performance management program. Many of the factors that limit effectiveness within a plant or corporation are the direct result of insufficient knowledge or training of the work force. This directly affects the following: machine/process operation; maintenance planning; the proper methods required to select, install, and maintain machinery; design and purchasing methods; and management methods. A basic premise of any plant improvement program must be a comprehensive skill evaluation and training program that will provide the basic skills required for each job within the plant. Therefore, a continuous education program should be a major part of the program plan.

BASIC KNOWLEDGE Each employee must have clear, complete knowledge of his or her job and its contribution to overall plant performance. At a minimum, this knowledge must address the following issues.

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140

KEY POINTS

OF WORK

Each employee's clear understanding of his or her role in the organizational structure is a fundamental requirement. This knowledge must include a well-defined job description that defines all the duties and tasks required for effective completion of the job. While it may seem trivial, this task is absolutely essential. Too few plants have viable job descriptions for their employees. In fact, many corporations, including those viewed as leaders in their industries, do not have any job descriptions. As a result, inefficiency, errors, inconsistent employee relations, and other failure modes occur, which directly impact plant performance. CRITERIA

FOR JUDGMENT

Employees have a fundamental need to know the criteria that are used to measure their performance and contribution to the plant. Without this understanding, the work force cannot be expected to measure up to the expectations of management or to provide a consistent, positive contribution to plant performance. Evaluation criteria should be clearly defined and must be consistent throughout the corporation. Too often, this is not the case. The expectations for worker performance, as well as the criteria used to measure this performance, are constantly changing. This constant fluctuation of standards is a primary source of poor performance. OPERATING

CRITERIA

OF PLANT

SYSTEMS

Even though it may be hard to believe, most plant and corporate employees lack a basic understanding of the plant systems they manage, operate, support, and maintain. As a result, mistakes are made every day that reduce capacity, product quality, equipment reliability and increase total operating costs. All employees, from senior management to the newest hourly worker, should have at least a basic understanding of how critical plant manufacturing and production systems work. This is especially

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true for the management group. Without a clear knowledge of the acceptable operating envelope of these systems, managers cannot make decisions that will provide optimum equipment use. Operators and maintenance personnel must have a thorough understanding of machine and system dynamics. How else can they be expected to effectively operate and maintain these systems? Both groups~managers and operators/maintenance personnel~must have an absolute understanding of the cause-and-effect relationship between their actions and the reliability of the system. EQUIPMENT

MANAGEMENT

Poor equipment utilization is one of the more common problems that severely limit plant performance. Although this is predominately a training issue, senior management, plant culture, and the information management methods also contribute. Few plants expend any time or effort training plant personnel in the proper methods required to achieve effective utilization of plant equipment. This is especially true for the management and planning functions. The apparent assumption is that, intuitively, the personnel who comprise these functions will fully utilize these resources. This assumption is absolutely not true. CONTROL

METHODS AND SYSTEMS

Employees must have and fully understand the proper procedures and practices required to fulfill their job functions. In the case of operators, standard operating procedures must be available, understood, and followed. The same is true of maintenance mechanics, planners, supervisors, and every other job function within the organization. In addition, employees must have clear, consistent directions or policies that distinctly define acceptable performance practices within the company. Without a precise, universal understanding of what is expected, plants have little chance of achieving or sustaining effective performance.

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AND CORRECTION

OF ABNORMALITIES

Problem solving is an essential skill that must be universal across the corporation. Numerous books, training courses, and troubleshooting guides are available to help with this. All these provide a road map that defines the logical steps that must be taken to resolve problems that will constantly develop in any plant. The limitation of these problem-solving training guides is that few workers have the basic knowledge of plant systems that is an absolute requirement for effective use of them. All employees need to have a basic knowledge of machine and system dynamics. This knowledge will provide the ability to recognize abnormal behavior in critical plant systems. This is the first step in problem solving. Once an abnormal behavior is recognized, the employee can begin the process of problem resolution. With knowledge of system dynamics, an employee can use almost any one of the problem-solving methods, such as fault-tree, cause-and-effect, and sequence-of-events, to isolate the root-cause of the problem and develop a cost-effective solution.

TRAINING

PROGRAM

Training, within the scope of the program, is divided into the following classifications: employee involvement, reliability and predictive technicians/engineers, maintenance craftsmen, planners, operators, buyers and expediters, plant engineers, and managers. Each of these classifications will have an ongoing course of study that will provide the practical skills required for achieving optimum efficiency throughout the facility. The training program is a long-term commitment of management to continually upgrade the knowledge and efficiency of personnel in a phase of the operation. This training is not a series of courses that will be taught once and then forgotten. The training program should adopt a systematic approach. Each step, as defined in the following sections, is essential to the long-term success of both the training and total plant improvement programs.

Train, Train, and Retrain STEP

1: E V A L U A T E

143

SKILLS

The most difficult part of employee training is to develop a viable methodology that will identify the specific training requirements within the plant. However, it is essential that a plant-specific method of continual evaluation of the skill levels of all employees be developed and implemented as part of a continuous improvement program. Without adequate employee skills, there is little chance that improvements will be achieved. There is only one way that this can be accomplished: Employees must be tested, and their ability to perform their assigned duties must be evaluated. In some plants, this will raise a major labor relations issue. Some labor agreements preclude testing hourly employees for any reason. This issue must be resolved before beginning the evaluation process. Actual evaluation of employee skills is a two-step process. The first step is to define the specific skills each employee must possess to perform his or her job. The second step is to administer practical testing to determine whether or not the employee has these skills. D u t y T a s k Analysis This process cvaluatcs cach job function to determine the specific skills required. For example, a machine operator must perform specific tasks in a predetermined sequence to effectively produce quality products at acceptable production rates. The duty task analysis will evaluate the specific requirements of a machine or production system to determine each task, the appropriate sequence of tasks, and the skills required to perform the tasks. In most cases, the operating instructions provided by the original equipment vendor are used for the first part of this analysis. It will define the tasks and sequence but will not provide the skills required. Determining the specific skills required for performing the identified tasks would require an experienced industrial engineer. These skills are not often available in-house and will probably require the use of a consultant.

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The duty task analysis will provide a detailed description of the specific skills required to perform each job function. These data should be used to develop a testing program that can be used to measure employee skills.

Skills Testing and Evaluation This process should include both written and practical testing of employee skills. Both forms of testing are required to develop a true picture of the employee's ability to effectively perform his or her job. Care must be taken to ensure that the tests are impartial and not distorted by personality conflict or bias on the part of the tester. These tests must also be uniformly applied throughout the plant. Because of the potential labor relation issue, there can be no hint of prejudice or favoritism. When the skills testing is complete, plant personnel can be broken down into four basic classifications or stages of skills. F o u r Levels o f Skills Generally, four major classifications or stages of skills exist within a plant. These levels include the following. Don't Know

Employees within this classification lack the basic knowledge required to provide minimum levels of effectiveness in their assigned jobs. A surprising number of workers usually fall within this classification, and this is a clear indication that the plant lacks either a viable training program or a commitment by management to sustaining a skilled work force. In part, this failure can also be attributed to the lack of valid job descriptions for plant personnel. Too few plants have current job descriptions that concisely define the roles of and expectations for all

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employees. Obviously, without a clear understanding of one's role, it is difficult to perform that role. A third contributor to the large number of emplyees in this classification is the lack of basic skills, such as reading comprehension. A measurable percentage of plant personnel, including supervisors and managers, cannot read or write at acceptable levels. Employees who fall within this classification present a real challenge. The plant's training program must include these basic skills as a prerequisite to those courses that are required to perform specific job functions.

Know, but Cannot Perform In most cases, employees who fall into this category have the basic skills required to learn and perform their assigned duties but lack the necessary skills to actually do the job. This is predominately a training problem. Either the plant does not provide adequate training, or management does not enforce the absolute adherence to employee training.

Can Perform, but Not Well Several factors contribute to this classification. The first is a lack of supervised on-the-job training. In too many plants, new employees receive an average of fifteen to thirty minutes of practical, on-the-job training. Ineffective procedures and practices is another contributor to this employee skill category. Few plants have current, valid procedures that are essential to the employee's ability to effectively perform his or her job. The third c o n t r i b u t o r is lack of effective supervision. Many employees perform their job functions by rote. They consistently perform their jobs without any effort to improve their efficiency or effectiveness. In my view, this is a failure of supervision to encourage~and, if necessary, to enforce~acceptable performance.

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Can Perform with Confidence The object of all plants should be to have all their employees fall within this classification. Employees with these skill levels excel in their jobs. STEP 2: DEFINE TRAINING

REQUIREMENTS

Based on the specific needs defined in Step 1, develop a clear definition and priority of training requirements. As part of this task, training standards should be developed that will govern the preparation and dissemination of training throughout the life of the program. A training standard is a document that lists all the training requirements as behavioral or performance objectives for each position, such as maintenance craftsman, planner, and so on. Analysis of the duty task data is necessary to determine the training requirements for each plant function. Tasks may be eliminated, task clusters developed, and objectives determined as a part of this analysis. STEP 3: PREPARE COURSE PLANS

Each course plan should include an instructor's guide, as well as training materials, such as manuals, visual aids, and other items required for comprehensive presentation of the course. The instructor's guide should provide administrative direction and detailed lesson plans for course instructors. Testing procedures, grading procedures, prerequisite requirements, and course sequence are examples of instructor's guide topics. Training materials may include trainee texts, workbooks, laboratory manuals, reference materials, slides, transparencies, videotapes and audiotapes, and evaluation instruments. The training process controls these materials so that training consistency can be assured. STEP 4: SELECT INSTRUCTORS

Selection of qualified instructors is critical to success. Many training programs fail because instructors are selected based on their abil-

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ity to apply a specific knowledge. For example, a m a i n t e n a n c e mechanic who has the ability to troubleshoot or repair hydraulic systems may be selected to teach hydraulics without any consideration of his or her communication skills. It is not enough to understand a subject or to be a subject-matter expert. Unless the instructor has the ability to organize and communicate this knowledge, his or her knowledge is worthless in the classroom. Instructors must be selected based on their knowledge of the subject and their ability to communicate that knowledge to others. Both capabilities must be present before effective training can be achieved. STEP 5: TRAIN

INSTRUCTORS

The goal of a high-quality, effective, and efficient training program requires both systematic development of courses and a qualified training staff. This staff should be acquired through careful selection, training, and development. The first qualification for an instructor is mastery of the technical skills and an in-depth knowledge of subject material. The second qualification is instructional skills. These two traits are often not resident in one individual. An expert on the subject who doesn't have the ability to communicate that knowledge to students cannot provide the level of instruction required for meeting the plant's training requirements. The instructor's level of knowledge must be broad enough to answer questions about and to expand course material so that the students can obtain a practical understanding of the concepts and practices covered by the course. STEP 6 : P R O V I D E C L A S S R O O M T R A I N I N G

Presentation of each training course should be properly organized so that training time is effectively utilized. A formal structure for verbal and visual presentation should be developed and used for all classroom sessions. All classroom instruction should conclude with a written test and a practical test (see next step) that are designed to measure the reten-

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tion level of each attendee. The intent of these tests should be to define specific weaknesses of each student so that additional training can be provided during the practical application effort. Data derived from the tests should also be used to upgrade the training program. Chronic weaknesses may point out areas within the course that need to be expanded or reworked to ensure proper instruction. STEP 7: PROVIDE TRAINING

PRACTICAL

APPLICATION

In most cases, classroom training alone will not be enough to provide plant employees with the useable skills required to fulfill their jobs. Therefore, classroom training should be augmented with practical, or hands-on, training. Two approaches can be utilized for the practical training: workshops or on-the-job training. Hands-on training should be conducted under the cognizance of the training department. This training is an extension of the classroom training and normally proceeds at the trainee's own rate. Formal objectives should be established, and a documented record should be kept of the attainment of each objective. On-the-job training should be conducted under the cognizance of the applicable department with assistance from the training department. The development plan usually includes some preplanned job experiences designed for the individual after he or she is assigned to the job. STEP 8: VERIFY

CORRECT

U S E OF T R A I N I N G

The evaluation of job performance capability is carried out in two ways. First is the supervisor's observation and evaluation of the performance of routine tasks. A prerequisite of this evaluation method is supervisor training. Each supervisor must have adequate knowledge that will enable him or her to judge the performance level of each employee.

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An alternate approach is to develop a follow-up evaluation program as part of the formal training program. In this instance, the instructor (or his or her designated representative) would evaluate the on-the-job performance of each student. The intent of both of these evaluations is to ensure proper retention and utilization of the techniques and methods provided by the instruction.

STEP 9:

IDENTIFY

WEAKNESSES

During the supervisor's or instructor's evaluation of the employee/student, he or she should document any deficiencies in performance and remedial action should be made a part of each person's development plan.

INITIAL

TRAINING

REQUIREMENTS

The initial training schedule will provide concentrated training designed to prepare existing plant personnel for the total plant program. The initial training will include, as a minimum, the following courses. EMPLOYEE INVOLVEMENT

Employee involvement is absolutely essential to the success of the Total Plant Performance Management program. Therefore, it is imperative that a continual series of awareness courses be included within the program. Augmented by regular newsletters, these courses should provide the ongoing communication between all employees that is essential to long-term success of the program.

Awareness Courses Awareness courses should be developed for each area of the plant, outside contractors, and equipment vendors. Within the plant, these courses should be developed to define the roles of purchasing, plant

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engineering, quality control, contracting services, training, accounting, other key members of the mill management team, and each employee within the total team. These courses should teach people how their particular occupations work within the process and how to do a top-notch job. Because total employee involvement is an absolute requirement of the total plant improvement program, these courses must be continual for the life of the program. If constant reinforcement of job requirements via the awareness courses is not continuous, the employees will tend to forget or lose focus. This loss of focus will hamper continuation of the program.

Root-cause Failure Analysis This series of courses will provide a step-by-step, logical approach to isolating the specific causes of machine failures and the best methods of preventing a recurrence. These courses must be prepared at a level suitable for all plant employees, not designed to train analysts. The intent of these courses, in part, is to help change the culture within the plant. The tendency, in most plants, has been to ignore problems rather than resolve them. These don't-make-waves and it'snot-my-problem attitudes are not conducive to optimum plant performance. A series of simplified failure analysis courses will provide the basic knowledge required for recognizing a potential problem, will create an environment that is constantly seeking improvement, and will increase employee involvement.

Problem Solving This course should be designed to provide all plant personnel with a logical, practical method of evaluating and resolving problems that may occur. It will provide a step-by-step method of defining the problem and potential solutions, isolating the problem source, and developing the best solution for both mechanical and nonmechanical problems. At this level, the courses should be limited to simple

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basics. The intent should be employee involvement, not to train problem-solving teams. PREDICTIVE

MAINTENANCE

Implementation of a comprehensive plant-improvement program will require a team of qualified analysts who are capable of fully utilizing predictive maintenance analysis techniques (that is, vibration, tribology, and thermography) to determine the operating condition of critical equipment within the mill and to determine the best corrective action. Therefore, a regular schedule of courses will be provided. The course schedule will include a comprehensive program of classroom and practical application instruction that will assure that a qualified team of analysts is maintained for the life of the program. The predictive maintenance training courses will include a combination of general knowledge and specific instruction in each of the predictive maintenance technologies. All technicians and analysts will be required to complete and pass the general knowledge courses. Specialists in each of the predictive maintenance techniques will be required to complete and pass courses in their specific analysis methodology.

Machinery Dynamics The machinery dynamics course is designed to provide practical knowledge of machine-trains that are used within the plant. The course material will include specific knowledge of how machines operate, how they fail, and how incipient failures can be detected. The course will provide the analyst with practical information about machine components, such as bearings and gears, and about how machine-trains should be installed, operated, and maintained for optimum life cycle costs. Specific instruction about how to set clearances (such as for bearings and gears), align machine-trains, balance rotating elements, and adjust machinery for optimum operation will be included. Course material should include, but should not be lim-

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ited to, the following: pumps, compressors, fans, blowers, gears, turbines, generators, motors, and other critical plant machinery. The machinery dynamics course will require three to five days of classroom instruction. The classroom training will be followed by two weeks of practical application of the course material and a final examination designed to determine the level of retention of each student. As part of the TPPM program, course material will be developed to include all the basic machine types utilized within the facility.

Data Acquisition and Analysis Techniques This series of courses will be divided into the three major predictive maintenance technologies (vibration, thermography, and tribology) and a fourth technique, called operating dynamics, which combines components of the three basic methods. Each analyst will be required to complete and pass course material in his or her area of expertise. The five-day course will include practical instruction in the basic techniques required to acquire and analyze data. Technicians and analysts will be instructed in proper data-acquisition methods and operation of the specific instrumentation selected for the program. In addition the course will define the limits of each technique and instrument, how to detect and correct problems within the instrumentation, and how to acquire accurate, repeatable data. A basic overview of operating dynamics Will be included in the data acquisition program. This portion of the course is intended to train the technicians and data collectors in visual observation and detection of potential machine-train problems. Analysts will be instructed in proper use of acquired data (that is, vibration, infrared scanning, and lube oil) and specific instruction in the use of the specific instrumentation, or system, selected for the program. Specific instruction that defines the limits and proper use of both the instrumentation and the analysis technique will be provided.

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O p e r a t i n g D y n a m i c s Analysis The operating dynamics course develops the knowledge provided in the machinery dynamics course and explains how individual machine-trains operate within a system. The machine dynamics course is a prerequisite. Knowledge provided in the course will be expanded from the machine dynamics course to teach how a simplex machine-train operates within more complex systems. The course will teach the analyst to look at the total system to determine both the operating condition and the operating efficiency of machinetrains and systems. In addition, the course will provide instruction about specific methods that can be used to confirm incipient problems that have been identified by the predictive maintenance program. It will also provide a working knowledge of the best verification method for each assumed problem and time required to complete. The operating dynamics training program will require a series of three- to five-day courses, followed by two weeks of practical application and a final examination that will determine the retention level of each student. Each course should concentrate at least one machine classification, such as compressors or continuous annealing line, and must include comprehensive, practical instruction that defines all aspects of machine operation. In addition, the courses must include specific repair and corrective actions that are appropriate for each machine classification. FAILURE

ANALYSIS/PROBLEM

SOLVING

The failure analysis course is designed to provide all employees with specific knowledge of how to logically resolve problems and determine the root-cause of a catastrophic failure. The course will define step-by-step procedures required to resolve any problem that may occur and determine the most cost-effective solution. Included in the course will be selection of the best nondestructive analysis method(s) for resolution of the problem.

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This course will require three to five days of classroom instruction and will include a final examination designed to test retention level. MAINTENANCE

CRAFTSMEN

The maintenance organization is charged with the responsibility of maintaining optimum operating condition of the critical machinery, systems, and equipment within its area of the plant. Therefore, a series of courses specifically designed to provide practical knowledge and skills training, for both assigned and central maintenance personnel, should be included in the continuous education program. The course plan includes the following.

Machinery Dynamics Unlike the course offered to the analysts, the course for central and assigned maintenance should not be designed to develop predictive maintenance experts. However, it is imperative that all assigned and central maintenance personnel understand the basic concepts of machinery dynamics. This course should be designed to provide a practical knowledge of how machines work and how to detect a potential problem. Skills T r a i n i n g A series of courses designed to teach basic maintenance skills must be an absolute requirement of the total plant improvement program. This series of courses will include, but will not be limited to, the following" 1. Proper bearing installation procedures 2. How to align machine-trains 3. How to balance rotating elements 4. Proper installation methods

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5. Proper bolting procedures 6. Proper disassembly and repair procedures. OPERATORS

Proper operation of critical plant machinery and systems has a dramatic impact on the operating condition bf the plant's critical equipment, machinery, and continuous systems. Operators must actively participate in the Total Plant Performance Management program, and it is absolutely essential that they understand their role in achieving maximum efficiency from the plant. A series of courses specifically designed for operators that will provide the practical knowledge they need to gain consistent production capacity, product quality, and availability should be developed to meet this requirement.

Operating Dynamics This course should be designed to instruct operators in the proper method of operating their machines and continuous process systems. In addition to basic machine types, such as fans, pumps, and compressors, the course should include continuous process systems, such as paper machines, continuous annealing lines, and ethylene production. The course material should be developed to show the effect of improper use of machinery. For example, too much strip tension or radical speed changes on continuous-process lines affects both product quality and maintenance costs. The instruction should provide operators with enough knowledge to detect common machine-train problems, adjust their operating procedures for optimum life cycle performance, and actively participate in the plant optimization program.

Preventive Maintenance Procedures The operator should be the front-line member of the plant team. With proper training, operators can provide minor adjustments

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a n d / o r corrective actions that may prevent a serious problem and delay. This course should be designed to provide the practical knowledge required for implementing first-level preventive maintenance on all critical plant machinery. This course should include, but should not be limited to: proper handling and maintenance of bolts and nuts; shafts and couplings; beatings; gears; power transmissions; sealing; and lubrication.

Visual Inspection Methods Machine operators should be directly involved in the maintenance improvement program. Regular visual inspection is one of the added responsibilities that should be assigned to operators. Therefore, a series of courses must be developed that will provide the operators with the skill levels required to perform this type of inspection. MAINTENANCE

PLANNERS

Without proper maintenance planning, few of the benefits that can be derived from the Total Plant Performance Management program could be accomplished. For this reason, the program must develop a comprehensive training program to ensure that all maintenance planners have the basic skills required to fulfill their function within the program. P l a n n i n g Skills Like any other job function, maintenance planning requires specific skills. In too many plants, planners are selected solely on the basis of availability, and little formal training is provided. A formal training program that provides the general knowledge required to properly plan and schedule maintenance is an absolute prerequisite of effective resource utilization. These classes should be provided for a period of three to six months and must be attended by all planners within the plant.

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Classroom instruction is not sufficient to provide the level of knowledge required for optimizing this critical function. Therefore, practical application and instruction within each division should augment the courses. This effort will require an extended period of time but is absolutely necessary to meet long-term objectives. This practical instruction will provide two benefits: Each planner (1) will develop the skills required to plan activities within his or her area of responsibility and (2) will develop the requirements for a uniform maintenance-planning program.

Maintenance Prevention To support the focus of the of the Total Plant Performance Management program, maintenance, plant engineering, sales, production, and purchasing personnel should receive training that will provide the criteria for design, selection, and procurement of new and replacement equipment. These courses should provide a practical knowledge of life cycle costing and maintenance-free design. The intent of these courses should be to define the design or equipment selection criteria that will provide the best life cycle performance of all new and replacement equipment, machinery, and production systems. Special attention should be given to how to develop equipment specifications that will ensure optimum performance, how to develop a request for quotation that will clearly define equipment performance and acceptance criteria, and how to evaluate proposals to ensure proper equipment is selected. SUPERVISORS

First-line supervisors often lack the basic skills required to fulfill their role in continuous improvement. Like maintenance planners, supervisors are usually selected without regard for their actual supervisory skills. As a result, they typically lack the management, communication, and people skills essential for effective supervision. Initial training for supervisors should include the following.

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Management Methods Management philosophy and methods directly affect plant performance. Therefore, the training program should include a series of courses designed to provide the management skills required for achieving optimum plant performance. Without a detailed evaluation of the existing levels of management skills, it is impossible to define the specific training requirements for this task. However, specific attention should be given to this critical need. Each manager must have the necessary understanding of the plant improvement program and skills required to properly utilize the tools, such as predictive maintenance, that are being implemented to provide the data required to properly manage the plant. If managers do not meet this requirement, maximum benefits cannot be derived. Omission of this phase of training can, and probably will, severely restrict the program. It is imperative that care is taken to ensure all supervisors and managers receive adequate management skills training and indoctrination of the concepts and methods of Total Plant Performance Management. Dealing with

People

Few first-line supervisors have the basic skills required to deal with the day-to-day interaction with their work force. The normal results of this deficiency are poor employee relations and morale problems that can adversely affect plant performance. Without these people skills, supervisors cannot universally apply and enforce the policies and procedures of the corporation. Generic supervisor training courses have limited value. Because these courses are written for a composite of industries and are often governed strictly by government regulations, they lack the plant-specific policies that the supervisor is expected to follow. Courses must be plant-specific and must include a concise guideline that the supervisor can follow in his or her day-to-day work.

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TRAINING

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PROGRAM

The long-term schedule must offer a regular schedule of courses that will provide the means to continually increase skill levels throughout the plant. An ongoing skills training program is critical to program success. As part of the training program, a method of evaluating the skill level of all levels of mill personnel will be developed. When fully developed, the Total Plant Performance Management program should provide the means to certify operators, maintenance personnel, predictive maintenance analysts, buyers, plant engineers, and managers for specific skill levels. To be successful, all areas of the plant must be involved. Therefore, a series of training courses designed to provide a comprehensive knowledge of the program would be developed for each area (including purchasing, plant engineering, and so on) of plant management.

CONCLUSION Now that we've examined the main components of the TPPM program in detail, it's time to take action. And the first step toward action involves "selling" the TPPM program to the appropriate people in your plant. Chapter 9 tells you how to do this.

Chapter 9

Selling Continuous Improvement The initial justification of any improvement program is difficult. Few integrated steel companies can afford to spend the money and people-power required for improving the effectiveness of their mills. This is especially true when order books are soft (no business or low backlog) and the economic projections are pessimistic. Then how do you convince corporate and plant management to invest in change? The six keys to the successful implementation of an improvement program are as follows.

1. F O R M U L A T E CONCISE AND OBJECTIVES

GOALS

Your justification package must include a clear, concise game plan. Corporate and plant management expects you to understand the problems that reduce effectiveness and to offer a well-defined plan to correct these problems. Therefore, it is imperative that you first understand all the factors that negatively affect performance in your mill. The first step in this understanding involves conducting a comprehensive evaluation of your facility. Evaluation of your plant will be the most difficult part of your preparation, partially because cost-

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accounting systems are not set up to track all the indices that define performance. At best, there will be some data for yield, unscheduled delays, and traditional costs (such as maintenance labor and material); but the data will be extremely limited. Also, use caution when gathering data. Typically, reports are compartmentalized and will only disclose part of the true picture. For example, information about delays will be contained in more than one report. Maintenance delay data will be divided into at least two reports: unscheduled and planned downtime. Information about operating delays will be in another report or reports, and material control data in yet another. To get a realistic analysis of downtime, you must consolidate all nonproduction time into one report. The same is true of yield. While working with one client, I found fifty-seven different yield reports for that plant. As you can imagine, developing a true picture of yield was extremely difficult. My best advice is to take your time during the evaluation process. Talk with the cost accountants and ask for their help. In many cases, they can provide the information you need; but they must clearly understand your purpose and need. Self-evaluation is extremely difficult. Each of us has built-in perceptions that influence how we interpret data. These perceptions are deep-rooted and may prevent you from developing an honest evaluation of plant effectiveness. One of my favorite examples is maintenance planning. Most of my clients state absolutely that they plan 80 percent of their maintenance activities. In reality, few, if any, of you actually plan 10 percent of your maintenance tasks. At best, 80 percent of your tasks may be on a written schedule; but few are effectively planned. H o w do you get around these perceptions? There is no easy answer. You must either make a commitment to honestly evaluate the effectiveness of each function and area within your plant or hire a qualified consultant to make the evaluation for you.

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2. KNOW YOUR AUDIENCE You cannot prepare your justification or write your program plan without understanding your audience. If your only audience was other personnel within your department, these tasks would be easy. Unfortunately, your audience can include laypeople, and each facet of that audience must fully understand and support your program. Selling the plan to at least four levels of your audience must be accomplished for a program to succeed: corporate management, plant management, division management, and the hourly work force. Corporate management must make the first commitment. Most improvement programs are expensive and will require corporate-level approval. Therefore, your initial justification package must be prepared for this critical audience. A successful package must be couched in terms these individuals will understand and accept. Remember that corporate managers are driven by one, and only one, t h i n g . . , the bottom line. The stockholders evaluate a plant's president and board of directors based on the overall profitability of the corporation. It is imperative that your justification package presents the means to improve profitability. It should talk about improvements using the key phrases "labor-hours per ton," "increased yield," and "reduced overall costs" to gain approval. Remember, the corporate-level executive is looking for ways to improve his or her perceived value. You must supply these means as part of your justification. To a lesser degree, plant executives are driven by the same stimuli. They tend to have a broader view of plant operations andwant to see justification couched in terms of total plant. One other factor is critical to success at this level. Most plant executives do not have a maintenance background. In fact, most have a built-in prejudice against the maintenance organization. Many are convinced that maintenance is the root-cause of the plant's poor performance. If your justification package and program plan is couched in maintenance terms or if you limit improvements to traditional maintenance issues, your chances for gaining this group's approval will be severely limited. Division management is the most critical audience. In most plants, the division manager controls all the resources required to imple-

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ment change. Regardless of the organizational structure, this level of management controls budget and the work force. Without its total, absolute support, your program cannot succeed. But if you can gain its support, you are well on your way to success. Most programs fail to address the final audience . . . . the hourly work force. This is an absolutely fatal mistake. Without the total support and assistance of the hourly workers, nothing can change. Your program plan must include specific means of winning initial support from the workers. The best way to accomplish this key milestone is to include their representatives in the program development phase and continue their involvement throughout the program.

3. FORGET YOUR

PREJUDICES

Each of us is conditioned by his or her experiences. As a result, we tend to prejudge or interpret events, data, and even conversations so that they comply with our preconceived view of the situation. In effect, we filter or distort input data to meet our conception of what should be, rather than what is. Prejudice is more than dislike or mistrust for anything alien to our view of life, business, or social norms. In the context of plant improvement, many believe that certain things cannot be changed. For example, some people believe that more production cannot be achieved from a critical production system because "everyone knows it's already operating at full capacity." Is this a true statement, or is it a perception? Adversarial relationships between functional areas of the plant are another form of prejudice that may prevent improvement. Typically, these relationships will include the friction between management and the hourly labor force and between production and the maintenance department. However, to a lesser degree, almost all functional groups in the plant will have less-than-adequate relationships with all other groups. These types of prejudice will limit your ability to resolve factors that limit plant performance. Not because they cannot be resolved

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but because you believe they are impossible to solve. Success depends on your ability to put aside these prejudices and embrace a firm belief that any problem can and will be solved.

4. CREATE

AN IMPLEMENTATION

PLAN

A concise, detailed program plan is the most important part of your program. Without a good plan, most programs will fail within the first year. The plan must include well-defined goals and objectives. Use extreme caution to ensure that goals are achievable within the prescribed time line. Most companies cannot afford to make the major capital investments that are required by improvement programs. Therefore, your program should use a phased approach. Specific tasks should be defined in a logical sequence that will minimize investment and maximize returns. Return-on-investment (ROI) must be the driving force behind your time line and implementation approach. Make sure all tasks required to accomplish your program are included in the program plan. Each task should do the following things: state a clear definition, including a deliverable; assign responsibility to a specific individual; and declare a start date and end date. In addition, each task description should include all tools, skills, and support required. ENSURE R E T U R N - O N - I N V E S T M E N T

If your company is like most others, it cannot afford to improve. With soft order (no business or low backlog) books and substantial losses, few plants can afford to gamble with their financial and personnel resources. Do not be misled; this is not an arbitrary management view. Your profit-and-loss statement clearly shows that the financial resources required to support an improvement program are simply not available. Therefore, your program must be designed to pay for itself. Every decision that is made must be driven by ROI.

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Unless your program can absolutely pay for itself, you should not consider implementation. Frankly, most maintenance improvement programs will not pay for themselves. The traditional applications of predictive maintenance, reliability-centered maintenance, total productive maintenance, and so forth are not capable of generating e n o u g h return to justify implementation. The only proven means of generating a positive return is to include the total plant in your program.

DO N O T O V E R S T A T E B E N E F I T S In an effort to win support for TPPM, your natural tendency may be to define outlandish benefits that will be generated by the program. In some instances, these projections are based on vendor data and are simply not valid. In other cases, you will overstate return-oninvestment as a means to ensure approval. This is perhaps the greatest mistake you can make. Remember that your justification will establish expectations you must meet. If you overstate benefits, you will be expected to deliver. In conclusion, make sure that you prepare your justification and plan to ensure success. The following steps detail the minimum effort you must expend.

DO Y O U R H O M E W O R K An honest, i n - d e p t h evaluation of your plant is an absolute requirement, as we discussed earlier in this chapter. This evaluation provides two essential data sets. First, it defines the specific areas that need to be improved. Second, it provides a baseline or benchmark that can be used to measure the success of your program.

5. TAKE

A HOLISTIC

VIEW

Do not limit your view of the plant to the traditional maintenance function. If you really want to improve the performance of your

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plant, look at every function that has a direct or indirect impact on performance. This should include sales, purchasing, engineering, p r o d u c t i o n , maintenance, h u m a n resources, and m a n a g e m e n t . Unless you take a holistic view, your program will be limited and so will its benefits.

6.

GET

ABSOLUTE

BUY-IN

The total, absolute support of all employees within your plant is essential to success. You must gain their support, or the program will fail. This task must be ongoing for the duration of your program. You must constantly re-enforce this commitment, or some portion of the work force will lose interest, and then you will lose the support of those workers. TAKE T I M E TO M A K E A D E T A I L E D

PROGRAM PLAN

Do not shortcut the program plan. It must be a concise, detailed document that provides clear direction for the program. Remember that the plan should be a living document. It should be upgraded or modified as the program matures. MAKE SURE COST ESTIMATES ARE ACCURATE

Many programs fail simply because we underestimate costs. Training, infrastructure, and required man-hours are typically underestimated. Make every effort to identify and quantify these costs as part of your justification. SET REALISTIC

RO!

MILESTONES

Clear ROI milestones will ensure continuation of your program. If corporate executives, especially within the financial function, can see measurable i m p r o v e m e n t , the probability of success is greatly improved.

Selling Continuous Improvement HAVE A TRACKING

AND EVALUATION

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PLAN

Selling the program is not over when the justification package is approved. You must continue to sell the program for its entire life. A well-defined tracking and evaluation plan, coupled with the ROI milestones, will greatly improve your chance of success. Remember, never, never stop selling the program. Newsletters, video presentations, periodic reports, and personal contact are essential to continuation and success of your program.

CONCLUSION When your TPPM program has been approved, it's finally time to put all your planning to the test by actually implementing the program. Chapter 10 will guide you through this process.

Chapter 10

Implementation

Implementing a Total Plant Performance Management program is a complex, long-term effort that will require the total commitment and involvement of all employees within the facility. A few individuals or groups within the plant cannot achieve maximum performance from the investment of a few months, or years, of effort. Achieving o p t i m u m plant performance will require a culture change for all employees within the plant. The normal mode of operation in U.S. industry is shortsighted. We tend to measure success based on short-term accounting. This what-have-you-done-today attitude must change to achieve long-term success. Offshore competition evaluates plant operation based on life-ofplant performance. In Japanese plants, the total focus of the entire organization, from operator to director, is to achieve the maximum performance over the life of the plant. Therefore, the total plant program must provide the means to restructure the traditional management and employee concepts and attitudes in order to create a plant environment that is conducive to long-term maximum productivity. Complete integration of a Total Plant Performance Management program will require a substantial investment of both time and money. Elimination of all the negative factors that typically exist within a large, integrated plant cannot be resolved immediately.

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It may take ten years, or more, and require a multimillion-dollar investment. Therefore, the TPPM program must be implemented in a manner that will generate immediate return-on-investment (ROI) equal to or exceeding the total implementation cost of the program. For this reason, the initial focus of TPPM will concentrate on the most severe problems. Because each Total Plant Performance Management program is configured to meet the unique requirements of a specific plant, the structure and implementation will be different for each program. However, the remainder of this chapter will detail a typical implementation program.

PROGRAM

DEVELOPMENT

Implementation of a Total Plant Performance Management program must generate an immediate ROI. Therefore, a clear, accurate understanding of the existing operating condition of the plant, and all functions within the plant, must be available before any change is made. PLANT EVALUATION

Phase I includes a comprehensive evaluation of the plant's effectiveness and efficiency. A set of baseline values must be established that defines the existing status of the plant or plants within the corporation. This evaluation should be based on at least three to five years of historical data to ensure a representative profile of performance. Unfortunately, most corporate cost-accounting systems are not set up to provide the type of data required for this type of evaluation, so the sections below will tell you, among other things, how to gain the information needed for each portion of the evaluation.

Financial Performance Evaluation of a corporation's financial performance seems like it should be a trivial task. It may seem that you can simply acquire data from the corporate information management system, and the data

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will give you an accurate view of past performance. Unfortunately, it's not that simple. The cost-accounting data that you will acquire in most corporations does not provide a true picture of actual performance. The following illustrations show why cost-accounting data can fail to truly reflect a plant's performance. Recently, I had an interesting discussion with a client. The discussion revolved around the difficulty of implementing a continuous improvement program in multiple heavy, integrated process plants. During the discussion, I mentioned the fact that I had implemented the TPPM program in hundreds of plants, including a number of offshore locations. The client was amazed that I had been able to achieve success in these offshore locations because the client could not understand how I could overcome the cultural and language problems when dealing with people half a world away. My response to this client was simple and factual. Dealing with an offshore company is, in many ways, easier than dealing with a domestic client. In offshore plants, everyone understands that there is a major difference in both culture and language. Therefore, both the consultant and client will acknowledge these problems and will make every attempt to compensate for these differences. In most cases, this extra effort will lead to a successful implementation of a total plant improvement program. Conversely, domestic clients do not recognize that the same differences exist in work culture and language in their plants. As a result, implementation is much more difficult. As an example, I made a presentation to a group of union workers at a client's plant. As part of the presentation, I stressed the poor performance levels of the plant. Some of the union workers took exception to my comments. Their response was that the plant was consistently performing at levels above 90 percent. Although their comment was true, the scale used to measure performance was invalid. Instead of measuring performance based on maximum availability, the plant artificially lowered the performance levels by deduction of all planned production and maintenance downtime from the total annual production hours. Instead of production levels above 90 percent, the plant's real equipment utilization was less than 60 percent.

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This illustrates how corporate environments can condition domestic clients and render cost-accounting data inaccurate. In almost all cases, they will adjust all inputs, whether from their own employees or a consultant, to their own preconceived interpretation. This often occurs because of the "filter factor," which you probably have seen at work in your plant. A problem develops on the shop floor. A worker reports the problem to his or her supervisor. The supervisor interprets the problem to ensure that it does not reflect poorly on his or her performance and then reports the filtered data to his or her supervisor. At each level of the management chain, the data is filtered. The net result is that by the time the problem reaches the plant manager, it has been distorted beyond recognition. The converse is also true. When senior managers attempt to implement change, they pass directions down the chain of management. At each level, their instructions are also filtered. By the time the new directives reach the shop floor, the intent has been totally altered. This filter factor results in more lost production, poor product quality, and abnormally high costs than any real limiting factor. The sad part is that usually no one within the management organization seems to realize that a filter factor exists in the plant. None would admit that he or she distorted or misinterpreted the data. As a consultant, I constantly face both cultural and communication problems with my domestic clients. One example is a continuous improvement plan that I developed for a client several years ago. I requested that four senior managers review the proposed plan before it was distributed throughout the plant. After evaluating the plan, all four managers said the plan clearly defined each step required to become a world-class company. All four were extremely positive in their review of the plan, and none offered any changes. Sounds good, right? With their support, the probability of a successful implementation should be high--but three of the four senior managers went on to say, " . . . but it will never work in our plant." They had been conditioned by their environment to believe that change, no matter how much it is needed, cannot happen in their world.

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Dealing with domestic clients is much like the biblical Tower of Babel. Each company, each plant, and in many cases each area of a plant has its own language. No one can accurately communicate with others outside his or her own discrete area. The loss of a common language among the work force prevented the effective construction of the Tower of Babel. This same language problem severely restricts plant performance and precludes the plant's ability to change. Here are two more illustrations of why you can't base the financial portion of your plant evaluation on cost-accounting figures alone. A few months ago, I was discussing the past year's performance with three senior managers of a corporation. When I asked them for the corporation's total production output for last year, all three gave a completely different answer. All three could support their figures with corporate documents, but none of the figures agreed. In another plant, I found that the plant had fifty different methods of calculating yield and that none of the generated numbers agreed. In these instances, corporate culture rather than practicality dictated the methods used. In sum, unless domestic plants acknowledge the restrictions imposed by corporate culture and multiple languages used within their plants, the potential for positive change is severely reduced. The first requirement of financial plant improvement is a total change in corporate culture. This change must implement a universal language that will permit concise, accurate communication throughout the corporation. In addition, the philosophy of the corporation must be conducive to positive change. The filter factor that permeates most plants must be eliminated and a concerted effort made to eliminate all preconceived, artificial limiting factors. Philosophy statements cannot accomplish these fundamental steps, nor can they be dictated. Management, starting with senior members, must lead the way. The financial condition of the corporation is governed by a multitude of variables, such as sales volume and price, that can result in a distorted profile of performance. Although many of the operating costs of a plant are fixed and probably remained relatively the same during the three- to five-year evaluation period, other factors may have varied greatly. The operating effectiveness of a plant cannot be

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evaluated based on the raw data contained in most companies' financial statements. To obtain a true profile, the evaluation must be normalized as much as possible. Normalization is relatively straightforward. All costs should be converted to a unit cost by dividing the total cost by the appropriate denominator. To adjust total maintenance cost to a cost per unit produced, simply divide the total cost by the total number of units produced. The same approach would be used to determine the unit sales price. Divide the total sales volume by the total units produced. Production volume and unit market prices vary from year to year, so the operating cost per unit produced will also vary. Because actual unit cost is the best indicator of performance, data must be normalized so that unit cost can be determined. At a minimum, financial data should be normalized for variations in sales volume, unit sales price, raw material cost, labor rates, overhead rates, and tax rates. In addition, any unusual or nonrecurring costs within the evaluation period should be excluded from the analysis. These variables should not be discarded. Some of these variables can point to problems that should be addressed by the improvement program. For example, a substantial increase in raw material costs could indicate the potential need to develop alternate suppliers or materials that would mitigate the increase's negative impact on the plant's ability to remain competitive. A marked increase in overhead may be indicative of reduced efficiency within one or more of the operating units.

Plant Performance A number of indices, discussed below, can be used to quantify the operating effectiveness of a plant. This part of the evaluation should be compiled separately for each of the discrete functions within the corporation, and then the individual evaluations should be combined to determine overall performance. The overall performance rating provides a global picture that will quantify the impact of each of these performance indicators, but cannot provide the level of detail needed in determining best corrective actions.

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The primary indicators of performance should include the following.

Capacity Utilization Many plant managers perceive that they are fully utilizing the manufacturing or production capacity of their plants. This is too often not the case. Few plants truly achieve and sustain full utilization. This part of the evaluation should quantify the actual, sustained capacity performance for each of the critical production systems in the plant. Each production system in a plant has a maximum capacity that is determined by its design, installation, and utilization. The steps required to evaluate true performance should include evaluations of design capacity, installed capacity, and operating losses. Design Capacity. The evaluation must first establish the original capacity design limits of each system. Normally, this information can be found in the original functional specifications developed as part of the procurement process or in the specifications provided by the vendor. In most cases, these specifications will clearly define the range of functions that the system was designed to deliver and specific performance criteria for the full range of operation or operating envelope of the system. You should pay close attention to the system's operating envelope. It provides the acceptable range of variables that can be handled by the system without adverse effect on performance, product quality, and useful life. Installed Capacity. The actual capacity limits of each system must be adjusted to compensate for restrictions imposed by its installation. For example, a centrifugal pump is designed to provide specific work in the form of discharge volume and pressure. This designed performance assumes proper installation that will include adequate suction volume and pressure, piping configurations, and a number of other factors. If the pump's installation restricts the suction volume or pressure, the design capacity is reduced by these limitations.

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This type of restriction is common to all machinery and production systems. Improper installation can radically reduce the maximum production capacity of these systems and, in some cases, prevent the plant from achieving acceptable performance levels. A viable plant performance evaluation should quantify the losses caused by improper installation. This is achieved by subtracting the installed capacity value from the design capacity. The financial impact of this loss can be determined by multiplying the lost capacity by the average unit sales price. For example, a loss of 100 units per hour, caused by improper installation, and an average sales price of $100 per unit is equal to a loss of $10,000 per hour. If the plant operates 24-hours per day year-round, this represents an annual loss of almost $ 87.6 million. Operating Losses. The mode of operation may also reduce the production capacity of critical plant systems. For example, a continuousprocess system might be designed to operate with five furnaces. If the system is operated with one or more of these furnaces out of service, the entire system's capacity is reduced. If, for example, prolonged operation with four of five furnaces reduced the production capacity by 20 percent, a continuous-process line with a design rating of 1,000 units per hour would be capable of only 800 units. The loss, 200 units per hour for a unit sales price of $100, is equal to $20,000 for each hour of operation at reduced capacity. Should this mode of operation continue for a full year, the annual loss would equal more than $175 million. These losses must be quantified to determine their impact on plant performance. Because the potential impact on profitability is so great, this type of loss is a primary candidate for immediate improvement efforts.

Equipment Utilization Another criterion of plant performance is how well the production systems are being utilized. Simply stated, this is a way to quantify losses caused by poor planning, downtime, and other factors that

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reduce the actual production time of plant systems. Let's discuss the more common reasons for equipment utilization losses. The most prevalent is a lack of sufficient sales volume to support additional production hours. However, even reduced sales should raise a serious question concerning the plant's competitive position. Other factors, such as scheduled repair outages, point out potential areas for immediate improvement. A good example of this occurred in 1997. An integrated steel mill increased its annual output by almost 500,000 tons simply by eliminating unneeded repair and maintenance outages. This improvement increased incoming revenue by $380 million and bottom-line profit by $150 million. Business Plan Losses. Most continuous-operation plants calculate capacity utilization based on the number of production hours in their business plans rather than the 8,760 physical hours in a calendar year. As a result, capacity utilization figures are often badly distorted. If a plant plans to produce product for 6,000 hours in a year from a production system that has a design capacity of 100 units per hour, the maximum annual capacity is 600,000 units. However, the system is capable of producing 100 units per hour for 8,760 hours in a year, or 876,000 units. This represents a loss of 276,000 units per year. With the $100 per unit average cost used above, this represents an annual loss of $27.6 million. Planning and Scheduling Losses. Another primary type of loss results from improper planning and scheduling of production and material flow through the plant. In addition, downtime and curtailed production capacity required for planned maintenance also contribute to this loss classification. This part of the plant performance evaluation should quantify the actual difference between maximum available production time and the actual hours of full production. Reason or cause should classify all deviations from maximum. For example, some percentage of the loss may be attributed to lack of incoming material, planned maintenance downtime, unscheduled delays, and other factors that rob production hours.

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All calculations of equipment utilization must use the physical limit of 8,760 hours per year as the denominator. Even though some plants do not operate continuously, the only true measure of utilization must be based on this limit. For example, a plant may only operate three shifts, five days each week. In a calendar year, the total production time for this plant is only 6,240 hours. M t h o u g h many would consider the 6,240 hours to be the appropriate denominator for calculating equipment utilization, this level of operation represents a loss to the company. Even when production systems are idle, incurred costs directly impact the financial condition of the company. In addition, the capacity loss caused by this planned downtime represents a substantial financial loss for the company. In our example, plant production systems are idle for 2,520 hours each year. Again, using our 100 units per hour and $100 per unit sales price, this represents a loss of $25.2 million in potential revenue that would certainly change a company's financial statement.

Cost of Quality A third potential loss category should be quantified as part of the plant evaluation. The objective of all manufacturing plants is to eliminate all product quality problems that force prime-grade products to be scrapped, reworked, or downgraded. This part of the evaluation should quantify the impact of deviations in product quality that result in an incurred cost or loss of revenue. This evaluation must start with a clear definition of the total production capacity in a specific year. This capacity should include all products produced, regardless of their quality. This total becomes the denominator in furore calculations. Because the information management systems vary greatly from plant to plant, extreme care must be taken to ensure an accurate determination of total units produced. Next, determine the actual volume of product that was sold as prime grade. This value must exclude any product that required rework or special handling to overcome an in-process defect. Any product that was not first-time-through prime grade will be quantified later.

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Finally, all reworked, downgraded, and scrap products should be quantified. R e w o r k . Products in this classification can be returned to prime grade w i t h additional processing. However, the cost incurred because of this extra effort must be quantified as part of the cost of quality. For example, some non-prime steel or aluminum can be returned to the steel-making process, where it can be melted and reprocessed. The cost of inspection, material handling, and energy required to return the material to the process represents the rework cost in this example. Downgrades. Some products can be sold as lower-grade products without the incurred cost of rework. These are classified as downgrades or diversions. The cost of quality associated with this class of product is the difference between the selling price of prime and the price of the downgraded product. For example, prime tin-plated steel may sell for $700 per ton, and a lower grade of plated steel for $500. If product is downgraded, the cost of quality is $200 per ton. A 1 percent diversion rate, in an integrated steel mill or petrochemical plant with an annual capacity of five million tons, could represent a revenue loss of $10 million. Scrap. As the name implies, this classification includes all products that cannot be sold, regardless of grade. In most cases, this is a relatively easy number to quantify. Because most plants make every effort to avoid scrap, it should be a relatively small part of the total cost of quality.

Manpower Distribution Many plants have substantially reduced their head counts during the past ten years. Generally, these reductions have relied on early retirement, forced reductions in workers, and other means to lower the recurring labor and pension costs of the corporation.

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The plant may have the appropriate number of managers, supervisors, or hourly workers, but they may not be assigned to effectively meet the manning requirements of all departments or functional groups. For example, one area of the plant may have more supervisors than are needed, while other areas are ineffective because of inadequate supervision. This type of problem is especially true in many maintenance organizations. Because head-count reduction plans do not consider worker distribution, there is a high probability that the mix of craftspersons will not match the actual needs of various plant areas. One symptom of poor distribution is overtime premiums. If your evaluation discloses high, recurring overtime costs in one or more areas of the plant, there is a good chance that manpower distribution is the root-cause. The only accurate way to determine the actual labor-power requirements of a plant is to perform a duty task analysis of each functional area. A duty task analysis provides specific labor-power and skill levels that are required to fulfill each job function within the corporation. From this analysis, a true picture of the actual number, types, and skill levels of employees that the plant requires can be determined, and those figures can be compared with the actual number, types, and skill levels of workers currently employed by the plant.

Maintenance and Production Cost History This analysis will determine the existing production and maintenance costs for the plant. The analysis will require an accurate, complete cost history for a period of three to five years prior to inception of the program.

Limiting Factors Analysis This task will determine specific factors that limit the plant's effectiveness and efficiency. Identification of specific problems or problem areas will provide the focus for the initial phase of the program. This evaluation will include preliminary evaluations of the methods used

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for management, plant engineering, purchasing, production, and maintenance.

Critical Equipment and Plant Area Analysis In most cases, maintenance labor, repair parts, delays, and other perceived maintenance-related costs are the major limiting factors within the plant. Therefore, this task will develop a fist, in order of priority, of plant equipment, machinery, and continuous-process systems. The critical equipment and plant area analysis should consider the impact of each production system or machine on the plant's ability to consistently produce prime quality and capacity. For example, a single loom in a textile mill's weaving room has little impact on its total production volume, but the loss of any component of a singletrain continuous process system has a catastrophic impact. Each machine or system should be ranked based on all variables that define acceptable performance. These should include capacity, quality, operating and maintenance costs, delay history, and any others that can be accurately quantified.

Staffing Requirements and Staff Availability Improving plant performance will require some level of staff members to have the responsibility of implementing and maintaining unique functions, such as predictive maintenance analysis. A fulltime, dedicated staff will be required for these efforts. This task will define the specific requirements for the staff and determine the most cost-effective means to man the program.

Cost-Benefit Analysis The final task in the evaluation process is to clearly define the costs required for implementing and maintaining a Total Plant Performance Management program and the realistic benefits that can be achieved. This analysis will also provide the initial ROI milestones for the program.

Implementation PROGRAM

PLAN

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DEVELOPMENT

The success of a TPPM program depends on a number of factors, including senior management commitment and total involvement of all plant employees. The primary key to these and the other factors that will determine the level of success of the program is a detailed plan that clearly defines the program and each step required to achieve the ultimate g o a l ~ o p t i m u m plant performance. The program plan must include a complete understanding of the actual operating condition of the plant and all its functions. This must be developed before an effective Total Plant Performance Management program can be implemented. There have been numerous attempts to adopt new management methods in our domestic industries. Many of these attempts have failed completely or resulted in limited improvements. The primary reason for these failures has been the omission of this first critical task. To develop your own TPPM program, fully evaluate and address the following areas. G o a l s a n d Objectives Success always starts with a clear, concise definition of the specific goals and objectives expected from the program. Each of the goals and objectives should be as quantitative as possible. General statements, such as "Improve maintenance by 10 percent," should be avoided. Goals

Goals define the specific improvements that the program is to generate. For example, a goal might be to eliminate an annual maintenance outage or to reduce overtime premiums.

Objectives Objectives define how each of the goals will be achieved. To be effective, objectives must be directly tied to a specific timeline and provide a full description of the tasks required to reach each goal.

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Organization As discussed in previous chapters, a successful continuous-improvement program will minimize the manpower required to administer the total plant program. In most cases, this type of program will require a full-time program coordinator or manager, but will fully utilize the functional organization of the plant for most improvement activities. The program plan should include specific responsibility and accountability for each job function within the plant. The examples included in Chapter 5 should be followed to ensure that the critical functional managers are included.

Staffing Staffing can be a serious limiting factor. In most plants, the initial phases of the program will require a substantial investment in both time and manpower. For example, full implementation of an information management system, such as the computer-managed maintenance system, will require a two- to three-year investment of time and as many as one hundred man-years of effort. In most plants, this level of labor-power is prohibitive. The staffing plan must include the specific manpower and duration required for each task necessary to complete the program. The best approach to this task is the use of a computer-based project management program that will permit direct entry of each task and its associated labor-power requirement. These programs are designed to automatically check for conflicts in resources and sequences of tasks. Without this type of software program, it is virtually impossible to effectively develop a staffing plan.

Management Methods Success will be determined by the management methods developed for the program. The program coordinator must have total

Implementation

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responsibility, authority, and accountability for implementation. Without any one of these three, the potential for success is greatly reduced. In addition, each task must have a specific employee who has similar responsibility for that task. The management plan should clearly define the specific methods that will be used to manage the entire implementation process. The plan should include specific directions that define roles and responsibilities for everyone involved in the program.

Skills Training The program plan should include a viable plan for short-term, or survival, training that will be needed during the initial phase of the program. In most cases, these short-term needs should be focused on the plant area or function that constitutes the starting point in the implementation schedule. For example, a program that focuses on maintenance improvement as the initial effort, or Phase I, should concentrate on craftsperson skills, planning, and supervisory skills. If the initial effort is production improvement, training should be focused on operating skills and other abilities needed to optimize the production area. The training plan should also include specific tasks designed to develop a viable long-term program. This portion of the plan should define specific methods that will be used to evaluate existing skill levels, course development, testing, and long-term follow-up.

Information Management Most continuous-improvement programs require substantial modification or total replacement of current information management systems. Even in small plants, this part of the improvement program may have a severe, negative impact on short-term effectiveness of the plant. Therefore, the program plan should fully develop a viable implementation plan that will minimize short-term impact and assure long-term success.

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Performance Tracking In most cases, this portion of the program plan will require complete replacement of current tracking methods. The program plan should clearly define the specific methods that will be used to track performance. The key factors of this plan are (1) input format, (2) one report for each variable, and (3) report frequency.

Input Format To be effective, everyone in the plant must use the same format, calculations, and content when reporting on each variable selected to measure plant performance. The program plan must clearly define each performance indicator and how it is to be calculated.

One Report for Each Variable There should only be one report for each of the variables that will be used to measure plant performance. For example, delays are typically divided into multiple classifications, such as planned delays, mechanical delays, and electrical delays. Each subdivision is reported separately; they are rarely combined. As a result, it is virtually impossible to gain a clear understanding of delays in the plant. The tracking program implemented as part of the total plant program should eliminate all duplication and segregation of data. In the case of delays, they all should be on a single report. This report should include all delays, clearly divided into subclassifications that quantify the reason for lost time.

Report Frequency The plan should establish a report or evaluation frequency that will assure timely information transfer. The frequency should be often enough to permit managers to take appropriate corrective actions without adversely affecting manpower requirements.

Implementation

18s

Measurable Benefits The goals and objectives established for the program have associated benefits. The program plan should include a detailed ROI schedule and specific milestones that can be used to evaluate the program's effectiveness.

Implementation Schedule All continuous improvement programs should be implemented in discrete phases. Even if a plant could afford to attack all the limiting factors that reduce performance, it would not be cost effective. The complexity of a simultaneous implementation would create a management nightmare and severely reduce the potential for success. Therefore, these programs should be implemented in a logical, stepby-step sequence.

Short-Term ROI The implementation plan should start with those tasks that will generate the maximum ROI in the shortest elapsed time. In most cases, the initial phase of the program will focus on equipment reliability improvement, which will include the traditional maintenance function. However, the actual sequence of implementation will depend on the specific needs of the specific plant. In the thirty years that the total plant approach has been successfully used, I have never used the same implementation schedule.

Long-Term Improvement Each subsequent phase of the program will use the same ROI logic. The second phase may focus on production, quality improvement, procurement, or the next function or factor that will generate maximum ROI. The implementation sequence will continue, in order of each limiting factor's ability to generate increased revenue or profit, until all the limiting factors are eliminated.

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Schedule Duration

The time required to fully implement a total plant improvement program will vary depending on the size of the plant and the complexity of the problem. In a small plant, total implementation may require less than one year, but larger plants may require three to five years to complete implementation. Unless a special reason to accelerate implementation exists, it is more cost effective to stretch implementation over a longer period of time. For example, TPPM has been fully implemented in multiple plants in less than three years, but the labor-power requirements and total invested costs were substantially increased because of the reduced time line. In a survival situation, acceleration of the time line may be justified, but it is not recommended.

CONCLUSION As this book has stressed, the TPPM program will be different for each plant, which is why you must mold these implementation guidelines to fit your plant's needs. However, one thing that seems to remain consistent from plant to plant is the overwhelming need to improve maintenance in the initial phase of the program, as Chapter 11 will discuss.

Chapter 11

Maintenance Improvement Maintenance costs are a major part of the total operating costs of all manufacturing or production plants. Depending on the specific industry, maintenance costs can represent between 15 and 40 percent of the costs of goods produced. For example, in food-related industries the average maintenance costs represent about 15 percent of the cost of goods produced; in iron and steel, pulp and paper, and other heavy industries, maintenance represents up to 40 percent of the total production costs. Recent surveys of maintenance management effectiveness indicate that one third, or thirty-three cents out of every dollar, of all maintenance costs is wasted as the result of unnecessary or improperly carried out maintenance. When you consider that U.S. industry spends more than $200 billion each year on maintenance of plant equipment and facilities, the impact on productivity and profit that the maintenance operation represents becomes clear. The result of ineffective maintenance management represents a loss of more than $60 billion each year. Perhaps more important is the fact that Americans' ineffective management of maintenance dramatically impacts their ability to manufacture quality products that are competitive in the world market. The loss of production time and product quality that results from poor or inadequate maintenance management has had a dramatic impact on America's ability to compete with Japan and other countries that have implemented 187

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more advanced manufacturing and maintenance m a n a g e m e n t philosophies. The dominant reason for this ineffective management is the lack of factual data that quantify the actual need for repair or maintenance of plant machinery, equipment, and systems. Maintenance scheduling has been, and in many instances is, predicated on statistical trend data or on the actual failure of plant equipment. Until recently, middle- and corporate-level management have ignored the impact of the maintenance operation on product quality, production costs, and more importantly on bottom-line profit. The general opinion has been, "Maintenance is a necessary evil" or, "Nothing can be done to improve maintenance costs." Perhaps these were true statements ten or twenty years ago. However, the development of microprocessor or computer-based instrumentation that can be used to monitor the operating condition of plant equipment, machinery, and systems has provided the means to manage the maintenance operation. This instrumentation has provided the means to reduce or eliminate unnecessary repairs, prevent catastrophic machine failures, and reduce the negative impact of the maintenance operation on the profitability of manufacturing and production plants.

MA! NTENANCE

M ETHODS

Industrial and process plants typically utilize three types of maintenance management: run-to-failure, preventive maintenance, and predictive maintenance. RUN-TO-FAILURE

MANAGEMENT

The logic of run-to-failure management is simple and straightforward: When a machine breaks d o w n . . , fix it. This if-it-ain't-brokedon't-fix-it method of maintaining plant machinery has been a major part of plant maintenance operations since the first manufacturing plant was built, and on the surface it sounds reasonable. A plant using run-to-failure management does not spend any money on

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maintenance until a machine or system fails to operate. Run-to-failure is a reactive management technique that waits for machine or equipment failure before any maintenance action is taken. It is, in reality, a no-maintenance approach to management. It is also the most expensive method of maintenance management. Few plants use a true run-to-failure management philosophy. In almost all instances, plants perform basic preventive tasks, such as lubrication, machine adjustments, and other adjustments, even in a run-to-failure environment. However in this type of management, machines and other plant equipment are not rebuilt and no major repairs are made until the equipment fails to operate. The major expenses associated with this type of maintenance management are high spare-parts inventory costs, high overtime labor costs, high machine downtime, and low production availability. Because there is no attempt to anticipate maintenance requirements, a plant that uses true run-to-failure management must be able to react to all possible failures within the plant. This reactive method of management forces the maintenance department to maintain extensive spare-parts inventories that include spare machines or at least all major components for all critical equipment in the plant. The alternative is to rely on equipment vendors that can provide immediate delivery of all required spare parts. Even if the latter is possible, premiums for expedited delivery substantially increase the costs of repair parts and downtime required for correcting machine failures. To minimize the impact on production created by unexpected machine failures, maintenance personnel must also be able to react immediately to all machine failures. The net result of this reactive type of maintenance management is higher maintenance cost and lower availability of process machinery. Analysis of maintenance costs indicate that the cost of a repair performed in the reactive, or run-to-failure, mode will average about three times higher than the cost of the same repair made within a scheduled, or preventive, mode. Scheduling the repair provides the ability to minimize the repair time and associated labor costs. It also provides the means of reducing the negative impact of expedited shipments and lost production.

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PREVENTIVE

Total Plant Performance Management MAINTENANCE

MANAGEMENT

There arc many definitions of preventive maintenance. However, all preventive maintenance management programs are driven by time. In other words, maintenance tasks are based on elapsed time or hours of operation. The statistical life of machinery is expressed in a curve that plots probable failure versus time in service. The meantime-to-failure (MTTF) or bathtub curve indicates that a new machine has a high probability of failure, because of installation problems, during the first few weeks of operation. After this initial period, the probability of failure is relatively low for an extended period of time. Following this normal machine-life period, the probability of failure increases sharply with elapsed time. In preventive maintenance management, machine repairs or rebuilds are scheduled based on the MTTF statistic. The actual implementation of preventive maintenance varies great' ly. Some programs are extremely limited and consist of lubrication and minor adjustments. More comprehensive preventive maintenance programs schedule repairs, lubrication, adjustments, and machine rebuilds for all critical machinery in the plant. The common denominator for all these preventive maintenance programs is the scheduling guideline. All preventive maintenance management programs assume machines will degrade within a time frame typical of their individual classifications. For example, a single-stage, horizontal splitcase centrifugal pump will normally run eighteen months before it must be rebuilt. Using preventive management techniques, the pump would be removed from service and rebuilt after seventeen months of operation. The problem with this approach is that the mode of operation and system-specific or plant-specific variables directly affect the normal o p e r a t i n g life of machinery. The m e a n - t i m e - b e t w e e n - f a i l u r e s (MTBF) will not be the same for a pump that is handling water and one handling abrasive slurries. The normal rcsuh of using MTBF statistics to schedule maintenance is either unnecessary repairs or catastrophic failure. In the example, the pump may not need to be rebuilt after seventeen months. Therefore, the labor and material

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used to make the repair would be wasted. The second result of using preventive maintenance is even more cosily. If the pump fails before seventeen months, the plant is forced to repair using run-to-failure techniques. Analysis of maintenance costs has shown that a repair made in a reactive (that is, after failure) mode will normally cost three times more than the same repair made on a scheduled basis. PREDICTIVE

MAINTENANCE

Like preventive maintenance, predictive maintenance has many definitions. To some, predictive maintenance means monitoring the vibration of rotating machinery in an attempt to detect incipient problems and prevent catastrophic failure. To others, it means monitoring the infrared image of electrical switchgear, motors, and other electrical equipment to detect developing problems. The common premise of predictive maintenance is that regular monitoring of the mechanical condition of machine-trains will ensure the maximum interval between repairs and minimize the number and cost of unscheduled outages created by machine-train failures. But predictive maintenance is much more. It is the means of improving productivity, product quality, and overall effectiveness of our manufacturing and production plants. Predictive maintenance is not vibration monitoring or thermal imaging or lubricating-oil analysis or any of the other nondestructive testing techniques being marketed as predictive maintenance tools. Predictive maintenance is a philosophy or attitude that, simply stated, means using the actual operating condition of plant equipment and systems to optimize total plant operation. A comprehensive predictive maintenance management program utilizes a combination of the most cost-effective tools (that is, vibration monitoring, thermography, tribology, and so on) to obtain the actual operating condition of critical plant systems and, based on these actual data, schedules all maintenance activities on an as-needed basis. Including predictive maintenance in a comprehensive maintenance management program will provide the ability to optimize the availability of process machinery and greatly

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reduce the c o s t of maintenance. It will also provide the means t o improve product quality, productivity, and profitability of our manufacturing and production plants. Predictive maintenance is a condition-driven preventive maintenance program. Instead of relying on industrial or in-plant averagelife statistics (mean-time-to-failure) to schedule maintenance activities, predictive maintenance uses direct monitoring of mechanical condition, system efficiency, and other indicators to determine the actual mean-time-to-failure or loss of efficiency for each machinetrain and system in the plant. At best, traditional time-driven methods provide merely a guideline to "normal" machine-train life spans. The final decision, in preventive or run-to-failure programs, regarding rebuilding schedules must be made on the basis of intuition and the personal experience of the maintenance manager. The addition of a comprehensive predictive maintenance program can and will provide factual data about the actual mechanical condition of each machine-train and the operating efficiency of each process system. These data provide the maintenance manager with actual information for scheduling maintenance activities. A predictive maintenance program can minimize unscheduled downtime of all mechanical equipment in the plant and ensure that repaired equipment is in acceptable mechanical condition. The program can also identify machine-train problems before they become serious. Most mechanical problems can be minimized if detected and repaired early. Normal mechanical failure modes degrade at a speed directly proportional to their severity. If the problem is detected early, major repairs, in most instances, can be prevented. Simple vibration analysis is predicated on two basic facts: (1) All common failure modes have distinct vibration frequency components that can be isolated and identified, and (2) the amplitude of each distinct vibration component will remain constant unless there is a change in the operating dynamics of the machine-train. By utilizing process efficiency, heat loss, and other nondestructive techniques, predictive maintenance can quantify the operating efficiency of nonmechanical plant equipment or systems. These techniques, used in conjunction with vibration analysis, can provide the

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maintenance manager or plant engineer with factual information that will enable him or her to achieve optimum reliability and availability from the plant. Five nondestructive techniques are normally used for predictive maintenance management: vibration monitoring, process parameter monitoring, thermography, tribology, and visual inspection. Each technique has a unique data set that will assist the maintenance manager in determining the actual need for maintenance. How do you determine which technique or techniques are required in your plant? How do you determine the best method to use for implementing each of the technologies? If you listen to the salesperson for the vendors that supply predictive maintenance systems, they each will tell you their particular system offers the only solution to your problem. How do you separate the good from the bad? Most comprehensive predictive maintenance programs use vibration analysis as the primary tool. Because the majority of normal plant equipment is mechanical, vibration monitoring will provide the best tool for routine monitoring and identification of incipient problems. However, vibration analysis will not provide the data you will need regarding electrical equipment, areas of heat loss, the condition of lubricating oil, or other parameters that should be included in your program. To achieve maximum performance from the total plant will require an extended period of time. The problems that exist in most plants have developed over many years and cannot be resolved overnight. Some of these problems, such as poor design of critical systems, may require a considerable financial investment. Poor management and working habits (the work culture) within the plant may take years to reverse. Most companies cannot afford to expend substantial resources, neither monetary nor work-power, without an immediate return-on-investment (ROI). Therefore, the Total Plant Performance Management program must be implemented in discrete increments designed to accomplish intermediate goals. These goals must be sufficient to offset all incurred costs and to generate a measurable degree of improvement in overall plant performance levels. With time, the program will achieve its final goal of optimum plant performance.

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Maintenance costs, as defined by normal plant accounting procedures, are normally a major portion of the total operating costs in most plants. Traditional maintenance costs (labor and material) in the United States have escalated at a tremendous rate during the past ten years. In 1981, domestic plants spent more than $600 billion to maintain their critical plant systems. By 1991, the costs had increased to more than $800 billion and are projected to top $1.2 trillion by the year 2000. This study indicates that on average one third, or $250 billion, of all maintenance dollars are wasted through ineffective maintenance management methods. American industry cannot absorb this incredible level of inefficiency and hope to compete in the world market. Other studies of domestic industries have shown that traditional maintenance costs represent, depending on the type of industry, between 15 percent and 40 percent of the total production costs. Neither of these figures includes the costs associated with lost production or reduced profits that result from poor product quality. When these maintenance costs are added, the total impact of maintenance is astounding. Because of the exorbitant nature of maintenance costs, they represent the greatest potential short-term improvement. Delays, product rejects, scheduled maintenance downtime, and traditional maintenance costs, such as labor, overtime and repair parts, are generally the major contributors to abnormal maintenance costs within a plant. The actual impact of these factors on your plant should have been well-defined during the program plan development stage. If your evaluation disclosed a substantial negative impact by the maintenance function on plant performance, the maintenance improvement plan, as defined by this chapter, should be the first step toward optimum plant performance. If not, then select the area or plant function that has the greatest impact on plant profitability. In many cases, the initial focus of the total plant improvement program should be directed toward immediate improvement of the maintenance function. Reduction of the negative factors normally associated with poor maintenance will require accurate data that define the effectiveness of the maintenance function within your plant. Some of these data should have been developed in the initial

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limiting factor analysis. However, a more detailed evaluation is needed before you proceed with this phase, and the elements of that evaluation are discussed next.

ROLE

OF MAINTENANCE

ORGANIZATION

Too many maintenance functions continue to pride themselves on how fast they can react to a catastrophic failure or production interruption rather than on their ability to prevent these interruptions. Although few will admit their continued adherence to this breakdown mentality, most plants continue to operate in this mode. Contrary to popular belief, the role of the maintenance organization is to maintain plant equipment, not to repair it after a failure. MISSION

OF MAINTENANCE

The mission of the maintenance organization in a Total Plant Performance Management program is to achieve and sustain the following seven things. 1. O p t i m u m Availability The production capacity of a plant is, in part, determined by the availability of production systems and their auxiliary equipment. The primary function of the maintenance organization is to ensure that all machinery, equipment, and systems within the plant are always on-line and in good operating condition.

2. Optimum Operating Condition Availability of critical process machinery is not enough to ensure acceptable plant performance levels. The maintenance organization also has the responsibility to maintain all direct and indirect manufacturing machinery, equipment, and systems so that they will continuously be in optimum operating condition. Minor problems, no matter how slight, can result in poor product quality, reduce pro-

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duction speeds, and affect other factors that limit overall plant performance. 3. M a x i m m n U t i l i z a t i o n o f Maintenance Resources The maintenance organization controls a substantial part of the total operating budget in most plants. In addition to an appreciable percentage of the total plant labor budget, the maintenance manager, in many cases, controls the spare-parts inventory, authorizes the use of outside contract labor, and requisitions millions of dollars in repair parts or replacement equipment. Therefore, one goal of the maintenance organization should be effective use of these resources.

4. Accurate Maintenance Records Without detailed, accurate historical data, maintenance cannot effectively fulfill its mission. This task should include all data, such as maintenance history and repair costs, for all plant assets. 5. O p t i m u m E q u i p m e n t Life One way to reduce maintenance cost is to extend the useful life of plant equipment. The maintenance organization should implement programs that will increase the useful lives of all plant assets. 6. M i n i m u m Spares Inventory Reductions in spares inventory should be a major objective of the maintenance organization. However, the reduction cannot impair its ability to meet the first five goals. With the predictive maintenance technologies available today, maintenance can anticipate the need for specific equipment and parts far enough in advance to purchase them on an as-needed basis.

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7. Ability to React Quickly All catastrophic failures cannot be avoided. Therefore, the maintenance organization must maintain the ability to react quickly to the unexpected failure. However, if all the maintenance improvement steps included in TPPM are implemented and used, the number of unscheduled repairs should be minimal. EVALUATION

OF T H E M A I N T E N A N C E

ORGANIZATION

One means to quantify the maintenance philosophy in your plant is to analyze the maintenance tasks that have occurred during the past two to three years. Attention should be given to the indices that define management philosophy. One of the best indices of management attitude and the effectiveness of the maintenance function is the number of production interruptions caused by maintenance-related problems. If production delays represent more than 30 percent of total production hours, reactive (or breakdown) response is the dominant management philosophy. To be competitive in today's market, delays caused by maintenance-related problems should represent less than 1 percent of the total production hours. Another indicator of management effectiveness is the amount of maintenance overtime required to maintain the plant. In a breakdown maintenance environment, overtime costs are a major negative factor. If your maintenance department's overtime represents more than 10 percent of the total labor budget, you definitely qualify as a breakdown operation. Some overtime is, and will always be, required. Special projects and the 1 percent of delays caused by machine failures will force some expenditure of overtime premiums, but these abnormal costs should be a small percentage of the total labor costs. Labor-power utilization is another key to management effectiveness. Evaluate the percentage of maintenance labor, compared with total available labor hours, that is expended on the actual repairs and main-

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tenance prevention tasks. In reactive maintenance management, the percentage will be less than 50 percent. A well-managed maintenance organization should maintain consistent manpower utilization above 90 percent. In other words, at least 90 percent of the available maintenance labor hours should be effectively utilized to improve the reliability of critical plant systems and not just to wait for something to break. An effective maintenance organization will include the following.

Maintenance Planning and Scheduling A well-trained maintenance-planning group is an absolute requirement of a successful maintenance operation. However, a surprising number of plants do not have a formal planning activity within their maintenance group. The few that do have planners have not invested in the resources, such as training and support, that their planning function needs to be effective. The general tendency is to select employees who do not appear fully loaded with other tasks and reassign them to fill the planning requirement. In most cases, these "planners" receive little, if any, training, and they do not have the basic information required to successfully complete their duties. Effective maintenance planning requires specific skills and abilities not common to most plant workers. Without formal training in these basic skills, a planner cannot properly execute this critical function. The objective of the maintenance planning function is to effectively utilize the maintenance staff and minimize the impact of maintenance downtime on the production capacity of the plant. Historical data indicates that unplanned, or reactive, repairs will cost about three times more than identical repairs that are well-planned. Therefore, creating an environment where all repairs and other maintenance activities are well-planned and scheduled for optimum intervals will substantially reduce overall maintenance costs. In addition, proper planning will increase the number of hours available for production, reduce product quality problems, and increase the production capacity.

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Labor-power Requirements These will vary from plant to plant. The number and complexity of a plant's production or manufacturing functions are the primary determining factors. As a general rule, a technician can acquire predictive data from about 400 measurement or sample points in an eighthour day. Analysis of these acquired data will take about as much time. Therefore, a team of one technician and one analyst can effectively acquire and analyze about 400 measurement points each day. If your process is more complex or does not run continuously, the number will be substantially reduced. The more complex systems, such as paper machines, will require much more time to acquire and analyze data. For those machines or systems that do not operate continuously, time will be lost waiting for a suitable period to acquire data. TRAINING REQUIREMENTS

Typically, predictive maintenance technicians and analysts receive between five and fifteen days of training for each of the technologies used within a program. Although this level of training is satisfactory for routine monitoring and trending, it is sorely inadequate for a total plant improvement program. In addition to the typical training, the predictive team should be trained in machine dynamics, basic maintenance skills, root-cause failure analysis, and other skills. This additional training is essential and will ensure maximum benefits from the program.

Maintenance History A significant limitation of many planning functions is a severe lack of information. To properly plan a simple repair or major repair outage, a planner must have factual data that define the specific tasks required. In addition, for each task the planner must know the following: time to complete, manpower required, labor skills needed, tools required, and specific steps needed to efficiently complete the

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effort. Few maintenance functions compile historical data that even come close to meeting these minimum requirements. Instead, they rely on the memories of maintenance staff members to estimate these data. The result is inefficiency, wasted time, and lost profits. All plants should have and maintain an historical data base that includes the information required for effective maintenance planning. As a minimum, the data should include the following: mean-time-betweenrepair (MTBR), mean-time-to-repair (MTTR), machine repair history, machine maintenance cost history, bill of materials, and standard maintenance procedures (SMPs) for every critical machine and major machine component within the plant.

Standard Maintenance Procedures These procedures are an absolute requirement of a maintenance improvement program. In part, the ineffectiveness of a maintenance organization is the result of improper or incomplete repair of critical machinery. Two factors contribute to this problem: (1) unclear definition of the problem and (2) the fact that the craftsperson does not know how to properly repair it. Too many repair work orders will state, "Inspect and repair as necessary." With this limited information, maintenance workers will disassemble a complex machine-train, try to ascertain what repairs are required, replace what they feel are the defective parts, and then reassemble the machine. With this approach, the probability that the machine-train is properly repaired and will operate with any degree of reliability is very low. SMPs will resolve, or at least substantially reduce, the number of ineffective repairs and increase the reliability of repaired machinery. A properly developed SMP assumes that the maintenance worker has never seen the machine that is to be repaired. It provides step-bystep directions for proper disassembly, repair, and reassembly. In addition, the SMP defines the specific skills required for each repair so that a qualified worker can be chosen to perform each task. It also defines the tools, materials, and time required for completing each task and ensuring that the work can be performed safely.

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PROCESS

Maintenance planning can be defined as the process used to develop a course of action. Effective maintenance planning involves the development of a course of action that includes all maintenance, repair, and construction work. It requires the identification of the following factors. Scope o f t h e J o b Most requests received by the maintenance department are not sufficiently defined. A request to "repair steam leak" may require replacement of a valve, replacement of piping, replacement of gland packing, or perhaps simply tightening a loose connection. To the extent possible, work to be done should be defined clearly and completely. If needed to identify the job, drawings or sketches should be made available. Location of the Job The exact location where work is to be performed should be identified by building number, department number, machine number, or some other meaningful designation. Job Priority Priority control is required so that the job can be scheduled according to its importance. Although each operation or facility has varying requirements, definite rules can and should be established to provide guidelines for job priority. M e t h o d s to Be U s e d Effective planning requires definition of methods. "Purchase and install" is considerably different from "fabricate and install." Whether fabrication means shop fabrication or field fabrication is also important. Welding requires different craft skills than fastening with bolts.

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The use of hand tools in place of machine tools may or may not be advisable. Although many jobs are clear-cut and require the usual crafts, there are also instances where several choices may exist.

Material Requirements If the scope of work and the methods to be used are determined, a natural by-product is the generation of a listing of materials. This is required to ensure that necessary materials are available.

Tool and Equipment Requirements It is not necessary to list the normal hand tools with which each craftsperson is equipped. However, any special tools should be identified so that they are available when the job starts. Torque wrenches, hoists, slings, and jacks are special tools and should be specified when needed. Skill

Requirements

Assuming that craft lines are followed, the various crafts required to perform the work should be identified. This will permit assignment of proper personnel.

Labor-power Requirements The number of labor-hours required to perform the work should be determined for each craft. This is necessary for control of scheduling. Safety

Procedures

Safety should be a primary consideration in maintenance planning and in all other facets of plant operation and maintenance. Each SMP and maintenance work order must include specific instructions that define safety procedures or safety concerns pertaining to each task of the job.

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The program should develop and implement guidelines for SMPs for each production group or functional area within the plant. Development of SMPs, that are compatible with the total plant program will require a considerable amount of time and effort. In most plants, the necessary historical information is not available and cannot be quickly generated.

PREDICTIVE

MAINTENANCE

PROGRAM

Effective planning and management depends on the ability to anticipate maintenance requirements. Predictive maintenance is typically used to meet this need. The maintenance planning and scheduling functions must have an accurate means of determining when specific maintenance tasks are required and the scope of each maintenance task and repair. Condition-based monitoring techniques, sometimes called predictive maintenance, can provide timely, accurate data that will drive the maintenance planning and scheduling functions. Predictive maintenance is not a substitute for the more traditional maintenance management methods. It is, however, a valuable addition to a comprehensive, total plant maintenance program. Where traditional maintenance management programs rely on routine servicing of all machinery and fast response to unexpected failures, a predictive maintenance program schedules specific maintenance tasks, as they are actually required by plant equipment. It cannot totally eliminate the continued need for either or both of the traditional programs (run-to-failure and preventive). Predictive maintenance can reduce the number of unexpected failures and provide a more reliable scheduling tool for routine preventive maintenance tasks. As has been previously mentioned, the premise of predictive maintenance is that regular monitoring of the actual mechanical condition of machine-trains and the operating efficiency of process systems will ensure the maximum interval between repairs, minimize the number and cost of unscheduled outages created by machine-

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train failures, and improve the overall availability of operating plants. Including predictive maintenance in a total plant management program will provide the ability to optimize the availability of process machinery and to greatly reduce the cost of maintenance. In reality, predictive maintenance is a condition-driven preventive maintenance program. A survey of 500 plants that have implemented predictive maintenance methods indicated substantial improvements in reliability, availability, and operating costs. The successful programs identified in the survey included a cross-section of industries and provided an overview of the types of improvements that can be expected. Based on the survey results, major improvements can be achieved in maintenance costs, unscheduled machine failures, repair downtime, spare-parts inventory, and both direct and indirect overtime premiums. In addition, the survey indicated a dramatic improvement in machine life, production, operator safety, product quality, and overall profitability. Based on the survey, the actual costs normally associated with the maintenance operation were reduced by more than 50 percent. The comparison of maintenance costs included the actual labor and overhead of the maintenance department. It also included the actual materials cost of repair parts, tools, and other equipment required to maintain plant equipment. The analysis did not include lost production time, variances in direct labor, and other costs that should be directly attributed to inefficient maintenance practices. The survey also showed that when plants began regular monitoring of the actual condition of process machinery and systems, they reduced the number of catastrophic, unexpected machine failures by an average of 55 percent. The comparison used the frequency of unexpected machine failures before implementing the predictive maintenance program to the failure rate during the two-year period after the addition of condition monitoring to the program. Projections of the survey results indicate that reductions of 90 percent can be achieved using regular monitoring of the actual machine condition. Predictive maintenance was shown to reduce the actual time required to repair or rebuild plant equipment. The average improvement in mean-time-to-repair (MTTR) was a reduction of 60 percent.

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To determine the average improvement, actual repair times before the predictive maintenance program were compared to the actual time to repair after one year of operation using predictive maintenance management techniques. It was found that the regular monitoring and analysis of machine condition identified the specific failed component(s) in each machine and enabled the maintenance staff to plan each repair. The ability to predetermine the specific repair parts, tools, and labor skills provided the dramatic reduction in both repair time and costs. The ability to predict machine-train and equipment failures and the specific failure mode provided the means to reduce spare-parts inventories by more than 30 percent. Rather than carry repair parts in inventory, the surveyed plants had sufficient lead time to order repair or replacement parts as needed. The survey compared the actual cost of spare parts and the inventory-carrying costs for each plant. Prevention of catastrophic failures and early detection of incipient machine and systems problems increased the useful operating life of plant machinery by an average of 30 percent. The increase in machine life was a projection based on five years of operation after implementation of a predictive maintenance program. The calculation included frequency of repairs, severity of machine damage, and actual condition of machinery after repair. A condition-based predictive maintenance program prevents serious damage to machinery and other plant systems. This reduction in damage severity increases the operating life of plant equipment. A side benefit of predictive maintenance is the automatic ability to monitor the mean-time-between-failure (MTBF). These data provide the means to determine the most cost-effective time to replace machinery rather than continuing to absorb high maintenance costs. The MTBF of plant equipment is reduced each time a major repair or rebuild occurs. Predictive maintenance will automatically display the reduction of MTBF for the life of the machine. When the MTBF reaches the point that continued operation and maintenance costs exceed replacement cost, the machine should be replaced. In each of the surveyed plants, the availability of process systems increased after implementation of a condition-based predictive maintenance pro-

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gram. The average increase in the 500 plants was 30 percent. The reported improvement was based strictly on machine availability and did not include improved process efficiency. However, a full predictive program that includes process-parameters monitoring can also improve the operating efficiency and therefore the productivity of manufacturing and process plants. One example of this type of improvement is a food manufacturing plant that made the decision to build additional plants to meet peak demands. An analysis of existing plants, using predictive maintenance techniques, indicated that a 50 percent increase in production output could be achieved simply by increasing the operating efficiency of the existing production process. The survey discussed above determined that advanced notice of machine-train and systems problems had reduced the potential for destructive failure, which could cause personal injury or death. The determination was based on catastrophic failures where personal injury would most likely occur. This benefit has been supported by several insurance companies that are offering reductions in premiums for plants that have a conditionbased predictive maintenance program in effect. Several other benefits can be derived from a viable predictive maintenance management program: verification of new equipment condition, verification of repairs and rebuild work, and product ,quality improvement. Predictive maintenance techniques can be used during site acceptance testing to determine the installed condition of machinery, equipment, and plant systems. This provides the means to verify the purchased condition of new equipment before acceptance. Problems detected before acceptance can be resolved while the vendor has reason~the invoice has not been p a i d ~ t o correct any deficiencies. Many industries are now requiring that all new equipment have a reference vibration signature provided with purchase. The reference signature is then compared with the baseline taken during site acceptance testing. Any abnormal deviation from the reference signature is grounds for rejection, without penalty, of the new equipment. Under this agreement, the vendor is required to correct or replace the rejected equipment. These techniques can also be used to verify the repairs or rebuilds on plant machinery.

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Vibration analysis, a key predictive maintenance tool, can be used to determine whether or not the repairs corrected the existing problems a n d / o r created additional abnormal behavior before the system is restarted. This eliminates the need for the second outage that, many times, is required to correct improper or incomplete repairs. Data acquired as part of a predictive maintenance program can be used to schedule and plan plant outages. Many industries attempt to correct major problems or schedule preventive maintenance rebuilds during annual maintenance outages. Predictive data can provide the information required for planning the specific repairs and other activities during the outage. One example of this benefit is a maintenance outage that was scheduled to rebuild a ball mill in an aluminum foundry. The normal outage before predictive maintenance techniques were implemented in the plant, to completely rebuild the ball mill, was three weeks, and the repair cost averaged $300,000. The addition of predictive maintenance techniques as an outage-scheduling tool reduced the outage to five days and resulted in total savings of $200,000. The predictive maintenance data eliminated the need for many of the repairs that would normally have been included in the maintenance outage. Based on the ball mill's actual condition, these repairs were not needed. The additional ability to schedule the required repairs, gather required tools, and plan the work reduced the time required from three weeks to five days. The overall benefits of predictive maintenance management have proven to substantially improve the overall operation of both manufacturing and process plants. In all surveyed cases, the benefits derived from using condition-based management have offset the capital equipment cost required to implement the program within the first three months. Use of microprocessor-based predictive maintenance techniques has further reduced the annual operating cost of predictive maintenance methods so that any plant can achieve costeffective implementation of this type of maintenance management program. Predictive maintenance is perhaps the most misunderstood of all the plant performance improvement tools. The general perception is that predictive maintenance is exclusively a maintenance-scheduling

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tool that uses vibration, infrared, or lubricating-oil analysis data to determine the need for corrective maintenance actions. Because of this perception, most of the programs that have been established during the past ten years continue to be reactive rather than proacfive. Although many of these programs have resulted in a measurable reduction in the number of delays caused by breakdowns, the majority have not effected a marked decrease in total maintenance costs or an increase in overall plant performance. In fact, the reverse is too often true. In many cases, the annual costs of repair and replacement have increased as a direct result of the predictive maintenance program. In addition, the number and frequency of scheduled repairs have increased to meet the accelerated demand for corrective action identified by the predictive maintenance program. Three factors have contributed to the negative results of traditional predictive maintenance programs. The fundamental reason that most programs have failed to achieve a marked improvement in total plant performance is the breakdown mentality that continues to dominate the management philosophy of many plants. Because of this attitude, we have failed to perceive the real benefits a predictive maintenance program can provide. Too many plants fail to understand that high maintenance costs are the visible symptom of a much more serious design, purchasing, production, or management problem that cannot be resolved by simply preventing catastrophic failure of critical machinery. Hundreds of examples exist in which companies have invested millions of dollars to implement a comprehensive predictive maintenance program. They have purchased state-of-the-art instrumentation and systems, hired and trained analysts, expended people-years of effort to establish their programs, and then limited the program to predicting when a critical machine will fail so that it can be replaced before a breakdown can occur. Then they cannot understand why their programs do not eliminate the negative factors that limit their competitive position. High maintenance costs are the direct result of inherent problems throughout the plant, not just an ineffective maintenance function. Poor design standards, poor purchasing practices, improper operation, and outdated management methods contribute more to

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high production and maintenance costs than do delays caused by catastrophic failure of critical plant machinery. The self-induced limitation imposed by the breakdown philosophy that continues to govern too many of our plants precludes benefits beyond a simple reduction in unscheduled delays. A second factor that reduces the benefits that could be derived from predictive maintenance is the limited capability of predictive instruments and systems. Each vendor of predictive maintenance instrumentation and systems has elected to focus on one technology, such as vibration or thermography, without any consideration of the requirements of a total plant predictive maintenance program. None of the individual technologies will provide the total capabilities a plant needs to eliminate its inherent problems. The vendors compound this limitation by restricting their products to specific methods, such as frequency-domain vibration data, that they perceive to be appropriate for all applications. As a result, many of these systems cannot be used on all of the critical machines or systems, cannot provide a complete definition of operating condition, will not withstand the working environment of typical plants, or increase the manpower requirements to a point that the program is not cost effective. In part, this limitation is the direct result of the vendor's lack of knowledge of plants and their limiting factors. Few vendors of predictive maintenance systems have direct knowledge of manufacturing and production plants. Even fewer have a practical understanding of the factors that limit plant efficiency and effectiveness. Instead, they are limited to a theoretical knowledge of vibration, thermography, tribology, or other nondestructive techniques. This lack of practical knowledge has severely limited the usefulness and universal application of predictive maintenance The final factor that has limited traditional programs is the improper use of diagnostic and analysis techniques. In most cases, existing programs have not utilized the real power that vibration, thermography, tribology, and the multitude of other plant evaluation techniques can provide. To some extent, this limitation is the result of management philosophy that has evolved in our society. We tend to seek simple answers to the extremely complex problems that limit

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our ability to compete in the world market. As a result, too many plants do not use the full capabilities of the various predictive maintenance technologies. The misuse of vibration analysis techniques is perhaps the best example of this poor utilization. Most vibration-based programs limit themselves to trending either overall or narrowband vibration amplitudes. This technique was intended to be a scanning method that would detect a potential change in machine condition, not to determine whether or not corrective action is required. Variations in speed or load, even on constant-speed/load machinery, will distort the trends to a point where they can become worthless. Even when the trend data are adjusted for variations in speed and load, trending cannot determine the root-cause of a problem. More advanced programs that have relied on signature analysis have also failed to achieve the full potential of this technology. Too many of these programs have limited diagnostics to either (1) comparison of signatures to baseline data or (2) the use of failure mode charts to determine what corrective action is required. At best, this approach will identify the symptom, such as a defective bearing or misalignment, of an incipient problem. This approach cannot identify the underlying cause of the observed symptom. Even with the limitations that exist in current predictive maintenance systems, plants can substantially increase the benefits a total plant program can generate. To do so, they must adopt a new management philosophy and implement their programs so that they address all the limiting factors that preclude optimum plant performance. The technology has matured to a point that predictive maintenance can provide the means to isolate and correct many of the inherent problems that adversely affect plant performance. Now they must change their approach to make use of these advancements. A few plants have recognized the limitations of traditional predictive maintenance and have expanded the capabilities, and resultant benefits, that this technology can provide. As a result, they have implemented the next generation of predictive maintenance. Within this new concept, their programs include a radical change in philosophy, diagnostic methods, and program objectives. Let's take a look at this revised approach to predictive maintenance.

Maintenance Improvement

THE

ROLE

OF PREDICTIVE

211

MAINTENANCE

Predictive maintenance should be an integral part of a Total Plant Performance Management program that is configured to eliminate all factors that limit plant effectiveness, not simply to schedule corrective maintenance tasks. The primary function of the program should be to eliminate the need for corrective~and radically reduce the need for preventive~maintenance, not just to predict when a critical machine will fail. Within this concept, predictive maintenance must provide the timely, factual data required to identify and correct incipient plant problems. In addition, it must provide the means to eliminate recurrence of chronic quality, capacity, and maintenance problems. To gain maximum benefits from predictive maintenance, management must adopt a proactive philosophy that is committed to the continual improvement of all facets of plant operations, not just the maintenance function. Management must create an environment that is conducive to change and that supports the broader perspective of predictive maintenance. This culture change may be traumatic in some plants but is an absolute requirement before a substantive improvement can be achieved.

OPTIMUM

USE OF PREDICTIVE

MAINTENANCE

Unlike traditional predictive maintenance, optimum application of predictive maintenance is not limited to the detection of simple mechanical or electrical failure modes within critical plant systems. Instead, the program is used to isolate any factor that can affect product quality, capacity factor, availability, maintenance costs, production costs, and a multitude of other issues that influence overall plant performance. This concept of predictive maintenance defines a set of monitoring and analysis parameters that will identify the actual operating condition of each machine-train as part of its total system. These parameters include operating condition, operating efficiency, interaction of the machine within its installed system, and operating condition of

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the total system. Examining this set of parameters will provide precise identification of all deviations from optimum operating conditions and specific corrective actions that will improve the performance of the total system. In most cases, an operating dynamics program (see Chapter 7) will use traditional monitoring technologies, such as vibration, tribology, and thermography. However, the monitoring and analysis methods used are radically different than those of productive maintenance. For example, the problem most often identified by traditional vibration-monitoring programs is defective bearings. In the next generation of predictive maintenance, a bad bearing is a symptom, not the problem. Bearings and other machine components do not fail without a reason. Although the simple ability to anticipate failure of a machine component was acceptable in predictive maintenance, it is not conducive to the level of improvement needed. The operating dynamics diagnostic approach permits the analyst to isolate the specific cause of the failure. For example, the reason for a bearing failure can be isolated to misapplication, improper installation, lack of lubrication, or a variety of other casual factors. Most of the problems can be resolved, but you must know the exact cause of the problem. In this instance, the top three causes are misapplication, improper installation, and lack of lubrication. These problems can be quickly corrected with a little education and better design or purchasing practices. In addition, this type of predictive maintenance includes process variables (such as pressure and flow), process parameters, operating efficiency, and product quality as key indices of plant performance. They are not limited to the traditional application of vibration, infrared, and lubricating-oil analyses. Rather, the program will use a combination of technologies that are best-suited for the specific application or system. Each program must be plant-specific. The unique requirements of each manufacturing or process plant prohibit generic implementation of predictive maintenance. The key is to implement a program that will accurately define the actual operating dynamics of each critical

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system within the plant. None of the individual predictive maintenance technologies will fulfill this requirement. In all cases, a total plant program will need several, if not all, of the predictive technologies to provide adequate coverage of critical plant systems. A variety of technologies can and should be used as part of a comprehensive predictive maintenance program. Vibration, infrared, lubricating oil, process parameters (such as pressure, flow, and temperature), visual observations, and other nondestructive testing data will be an integral part of the program. However, the logic used to interpret data will be radically changed in the next generation of predictive maintenance. Rather than simplistic failure modes, the diagnostic logic will be based on the actual design and normal operating dynamics of each process system. From these design data, a logic tree that defines normal operation and each deviation or failure mode of the system will be used to evaluate data. The results derived from this new adaptation of predictive maintenance have been tremendous. In addition to reducing the number and severity of unscheduled delays, each of these advanced predictive maintenance programs has dramatically reduced the total costs associated with plant operation. IMPLEMENTATION

OF PREDICTIVE

MAINTENANCE

Establishing a comprehensive predictive maintenance program that meets the needs of the plant requires the following.

Definition of Predictive Requirements The first task for this effort is to define the scope of a total plant predictive maintenance program. The program plan, developed earlier, should have defined the goals and objectives of the program, provided a global definition of the technologies that would be used, and estimated the manpower and costs required. These estimates should be refined into a specific definition of the exact scope of the predictive maintenance portion of the TPPM program.

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Defining the specific equipment, machinery, and systems that need to be included in the program should be the first task. Each production division, with the support of its assigned maintenance staff, should prepare a list that includes all equipment, machinery, and systems that are critical to its production process, have a chronic history of reliability problems, or have high repair a n d / o r replacement costs. The critical machine list should include all division equipment, with a priority assigned to each that will identify the potential severity to division production. The critical machine lists should be divided into three classifications: (1) mechanical, (2) electrical, and (3) others.

Selection of Best Predictive Maintenance Technology This evaluation will determine the unique characteristics of each machine and the most cost-effective predictive maintenance (monitoring and analysis) technique(s) for each machine. Because traditional maintenance cost and delays represent the largest potential improvement in the operating costs, the initial phase of the program will focus on reducing delays and increasing the effectiveness and efficiency of the maintenance operation. These technologies will include: (1) vibration monitoring, (2) operating dynamics, (3) thermography, (4) tribology, (5) visual inspection, and (6) process/machine efficiency.

Vibration Monitoring Acquisition and analysis of machine vibration data is a good means of detecting incipient problems in mechanical equipment and continuous-process systems. In the initial phase of the long-term program, vibration data will be acquired using a portable, microprocessorbased meter. As the program matures, the use of hard-wired and/or real-time monitoring may be added to improve the accuracy and response time for critical machinery or systems. The complexity, variation in load, and slow speed of many of the critical machines and process systems used within a typical plant will limit the capability of traditional vibration analysis techniques.

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To compensate for these limitations, a new diagnostic technique, called operating dynamics analysis, should be used to augment the vibration-monitoring program.

Operating DynamicsAnalysis Vibration data alone do not provide enough information to determine the actual need for maintenance and/or corrective actions. Traditional vibration-monitoring and vibration-analysis techniques discount the impact and influence of a machine's operating environment and therefore do not represent a complete picture of the machine's condition. Operating dynamics considers the total machine as it relates to the operating environment. In simple terms, this technique monitors and evaluates the actual operating characteristics versus the design operating characteristics of all critical machinery, equipment, and continuous-process systems within the plant. To implement and gain maximum benefits from operating dynamics analysis, regular monitoring of all the parameters that define the actual operating condition of each machine must be considered. Therefore, the predictive maintenance program will add regular monitoring and analysis of the process parameters that define the actual condition of each critical machine. The actual parameters will vary depending on the specific machine and its application. Simplex machinery, such as pumps, fans, and blowers, will need to undergo regular measurements of amp loads, suction/discharge pressures, process temperatures, efficiency, and other parameters that will help quantify the machines' condition and need for corrective actions. For complex machinery (such as continuous process), additional process parameters (load, tension, gauge, and so on) should be monitored to help determine the impact, if any, of process changes on the machinery.

Thermography The inclusion of infrared scanning technologies in the total plant predictive maintenance program is an absolute requirement. This

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technology is ideal for electrical equipment (such as motors and switchgear) and is the only technique that will provide accurate data about repair and corrective actions regarding this type of equipment. The maintenance improvement program will utilize computer-based, color-enhanced infrared imaging for all critical electrical equipment within the mill.

Tribology Lubricating-oil and wear particle analyses (tribology) will be used, as required, within the maintenance improvement program. The primary uses will include those mentioned below. Lubricating-Oil Analysis. Regular analysis of oil samples acquired from critical machinery in the plant will provide data that will be beneficial to the maintenance planning and scheduling activities. The primary uses of this technique will be limited to determination of the proper lubrication for each application and the proper time to change lubricant inventory on all critical machinery with large reservoirs. The technology has limited benefits as a maintenance planning tool on most mechanical equipment. However, other applications will be evaluated and added to the program as required. Wear Particle Analysis. Although not a primary predictive maintenance tool, wear particle analysis is an excellent failure analysis technology. Wear particle analysis will be utilized primarily to resolve catastrophic failures of mechanical equipment (such as gears) and to augment the vibration-monitoring program. Wear particle analysis can be used to support vibration analysis of sleeve (Babbitt) bearings on large, slow-turning machinery.

Inspections Regular inspections of critical plant systems are an integral part of a predictive maintenance program. The human senses are the oldest and perhaps still the best form of predictive maintenance. Properly

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utilized, these inspections can help reduce the number and frequency of repairs required for maintaining optimum condition of the plant. A formal inspection program should include inspection sheets for each machine or system that provide specific methods to identify incipient problems. Visual inspection should play a major role in the predictive maintenance program. Two forms of visual inspection will be utilized: operators and predictive maintenance data collectors. Visual inspection is perhaps the oldest form of predictive maintenance and continues to provide useful information that can be used for maintenance planning and scheduling. Therefore, visual inspection will be a key part of the long-term program. Operator Inspections. The operator is the only employee within the plant who is in constant proximity with critical process machinery, equipment, and continuous systems. It is therefore imperative that the operators constantly monitor the operating condition of their machinery and report any deviation from normal operation. Within the predictive maintenance program, a series of checklists will be developed for each production area, and these will be used by the operators to perform regular inspections of critical machinery. Specific checklists will be developed for each machine and/or system that will define the specific method(s) and frequency of inspections. Technician (Data Collector) Inspections. Most predictive maintenance programs will include regular measurement of vibration, infrared, and other data that will quantify the operating condition of critical plant systems. Programs that use portable data collection instrumentation also require that a trained technician collect the required data on a regular basis. Visual inspection should be included in the data that these technicians acquire as part of their normal activities.

Process~MachineEfficiency A key parameter that should be used to monitor plant performance is the efficiency of specific machines and all critical process

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systems. None of the other evaluations, except for operating dynamics analysis, considers this essential factor. Every machine or system used in production, manufacturing, and process plants is designed to deliver a specific function or range of functions. For example, a centrifugal pump is designed to deliver a specific volume of liquid, at a specific pressure, and with a specific expenditure of energy. These three criteria determine the design efficiency of the pump. If a plant is to achieve and sustain optimum performance levels, the pump used in this example must always perform at its design levels. In other words, it must be efficient. In addition to efficiency, all machines and systems include specific variables or parameters that can be used to quantify their operating condition and performance. Operators or automated control systems designed to monitor and maintain acceptable performance levels use these parameters. Variables such as flow, retention time, pressure, and a variety of others are used for this purpose. A successful performance improvement program must also use these variables as an integral part of its evaluation logic. Unlike the operator or automated control system, these variables are used to detect deviations from normal operating conditions that require corrective action that will assure long-term optimum performance and useful life of these systems. Combined with traditional technologies, such as vibration analysis, these parameters or variables provide the reliability engineer and predictive maintenance analyst with a complete data base that can be used to accurately quantify operating condition.

SELECTING THE BEST PREDICTIVE MAINTENANCE SYSTEMS After developing the requirements for a comprehensive predictive maintenance program, the next step is to select the hardware and software systems that will most cost-effectively support your program. Because most plants will require a combination of techniques (vibration, thermography, tribology, and so on) the system should be able to provide support for all the required techniques.

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A single system that will support all the predictive maintenance technologies is not available, so you must decide on the specific techniques that must be used to support your program. Some of the techniques may have to be eliminated to enable the use of a single predictive maintenance system. However, in most cases two independent systems will be required to support the monitoring requirements in your plant. Most plants can be cost-effectively monitored using a microprocessor-based system designed to use vibration, process parameters, visual inspection, and limited infrared temperature monitoring. Plants with large populations of heat transfer systems and electrical equipment will need to add a full thermal imaging system in order to meet the total plant requirements for a full predictive maintenance program. Plants with fewer systems that require full infrared imaging may elect to use an outside contractor for this portion of the predictive maintenance program. This will eliminate the need for an additional system. A typical microprocessor-based system will consist of four main components: a meter or data logger, a host computer, transducers, and a software program. Each component is important, but the total capability must be evaluated to get a system that will support a successful program. The first step in selecting the predictive maintenance system that will be used in your plant is to develop a list of the specific features or capabilities the system must have to support your program. As a minimum, the total system must have the following capabilities. USER-FRIENDLY

HARDWARE

AND

SOFTWARE

The premise of predictive maintenance is that existing plant staff must be able to understand the operation of both the data logger and the software program. Because plant staff members normally have little, if any, computer or microprocessor background, the system must use a simple, straightforward operation of both the data acquisition instrument and the software. Complex systems, even if they provide advanced diagnostic capabilities, may not be accepted by plant staff and therefore will not provide the basis for a long-term predictive maintenance program.

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AUTOMATED DATA ACQUISITION

The object of using microprocessor-based systems is to remove any potential for human error, to reduce labor-power, and to automate (as much as possible) the acquisition of vibration, process, and other data that will provide a viable predictive maintenance data base. Therefore, the system must be able to automatically select and set monitoring parameters without user input. The ideal system would limit user input to a single operation. However, this is not totally possible with today's technology. AUTOMATED DATA MANAGEMENT

The amount of data required to support a total plant predictive maintenance program is massive and will continue to increase during the life of the program. The system must be able to store, trend, and recall the data in multiple formats that will enable the user to monitor, trend, and analyze the condition of all plant equipment included in the program. The system should be able to provide long-term trend data for the life of the program. Some of the microprocessorbased systems limit trends to a maximum of twenty-six data sets and will severely limit the decision-making capabilities of the predictive maintenance staff. Limiting trend data to a finite number of data sets eliminates the ability to determine the most cost-effective time to replace a machine. FLEXIBILITY

Not all machines and plant equipment are the same, nor are the best methods of monitoring their conditions the same. Therefore, the selected system must be able to support as many of the different techniques as possible. As a minimum, the system should be capable of obtaining, storing, and presenting data acquired from all vibration and process transducers and providing accurate interpretation of the measured values into user-friendly terms. The minimum requirement

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for vibration-monitoring systems must include the ability to acquire filter broadband, select narrowband, time traces, and high-resolution signature data using any commercially available transducer. Systems that are limited to broadband monitoring or to a single type of transducer cannot support the minimum requirements of a predictive maintenance program. The added capability of calculating unknown values based on measured inputs will greatly enhance the system capabilities. For example, neither the fouling factor nor the efficiency of a heat exchanger can be directly measured. A predictive maintenance system that can automatically calculate these values based on the measured flow, pressure, and temperature data would enable the program to automatically trend, log, and alarm deviations in these unknown, critical parameters. RELIABILITY

The selected hardware and software must be proven in actual field use to ensure their reliability. The introduction of microprocessorbased predictive maintenance systems is still relatively new, and it is important that you evaluate the field history of a system before purchase. Ask for a user list, and talk to the people who are already using the system. This is a sure way to evaluate the strengths and weaknesses of a particular system before you make a capital investment. ACCURACY

Decisions about machine-train or plant system condition will be made based on the data acquired and reported by the predictive maintenance system. It must be accurate and repeatable. The microprocessor and software, as well as the operators, can input errors. The accuracy of commercially available predictive maintenance systems varies. Although most will provide at least minimum acceptable accuracy, some are well below the acceptable level. It will be extremely difficult for the typical plant user to determine the level of accuracy of the various instruments available for predictive maintenance.

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Vendor literature and salespeople will assure the potential user that their particular systems are the best, most accurate, or whatever. The best way to separate fact from fiction is to conduct a comparison of the various systems in your plant. Most vendors will provide a system on consignment for periods up to thirty days. This will provide sufficient time for your staff to evaluate each of the potential systems before purchase. TRAINING

AND TECHNICAL

SUPPORT

This support is critical to the success of your predictive maintenance program. Regardless of the techniques or systems selected, your staff members will have to be trained. This training will take two forms: (1) system users training and (2) application knowledge training to address the specific techniques included in your program. Few, if any, of the existing staff members will have the knowledge base required to implement the various predictive maintenance techniques discussed in preceding chapters. None will understand the operation of the systems that are purchased to support your program. Many of the predictive systems are strictly hardware- and software-oriented. Therefore, they offer minimal training and no application training or technical support. Few plants can achieve even minimum benefits from predictive maintenance without training and some degree of technical support. It is therefore imperative that the selected system or system vendors provide a comprehensive support package that includes both training and technical support. SYSTEM COSTS

Cost should not be the primary deciding factor in system selection. The capabilities of the various systems vary greatly, and so does the cost. Care should be taken to ensure a fair comparison of the total system capability and that a price is determined before the selection of your system is made. For example, vibration-based sys-

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tems are relatively competitive in price. The general spread is less than $1,000 for a complete system. However, the capabilities of these systems are not comparable. A system that provides minimum capability for vibration monitoring will be about the same price as one that provides full vibration-monitoring capability and also provides process parameters, visual inspection, and point-of-use thermography. Operating Costs The real cost of implementing and maintaining a predictive maintenance program is not the initial system cost. Rather, it is the annual labor and overhead costs associated with acquiring, storing, trending, and analyzing the data required to determine the operating condition of plant equipment. This is also the area where predictive maintenance systems have the greatest variance in capabilities. Systems that fully automate data acquisition, storing, and so forth, will provide the lowest operating costs. Manual systems and many of the low-end microprocessor-based systems require substantially more manpower to accomplish the minimum objectives required by predictive maintenance. The user list you obtained previously to determine reliability will again help you determine the long-term cost of the various systems. Most users will share their experience, including a general indication of labor cost. THE

MICROPROCESSOR

The data logger or microprocessor selected by your predictive maintenance program is critical to the success of the program. There are a wide variety of systems on the market that range from hand-held overall value meters to advanced analyzers that can provide an almost unlimited amount of data. The key selection parameters for a data acquisition instrument should include the following: the expertise required to operate, the accuracy of data, the type of data, and the labor-power required to meet the program demands (see the Predic-

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five Maintenance Organization section later in this chapter for a discussion about manpower).

Expertise Required to Operate One of the objectives for using microprocessor-based predictive maintenance systems is to reduce the expertise required to acquire error-free, useful vibration and process data from a large population of machinery and systems within a plant. The system should not require user input to establish maximum amplitude, measurement of bandwidths, and filter settings, and it should not allow free-form data input. All these functions force the user to be a trained analyst and will increase both the cost and time needed to routinely acquire data from plant equipment. Many of the microprocessors on the market provide easy, menu-driven measurement routes that lead the user through the process of acquiring accurate data. The ideal system should require a single-key input to automatically acquire, analyze, alarm, and store all pertinent data from plant equipment. This type of system would enable an unskilled user to quickly and accurately acquire all the data required for predictive maintenance. Accuracy of

Data

The microprocessor should be capable of automatically acquiring accurate, repeatable data from equipment included in the program. The elimination of user input on filter settings, bandwidths, and other measurement parameters would greatly improve the accuracy of acquired data. The specific requirements that determine data accuracy will vary depending on the type of data. For example, a vibration instrument should be able to average data, reject spurious signals, auto-scale based on measured energy, and prevent aliasing. The basis of frequency-domain vibration analysis assumes that we monitor the rotational frequency components of a machine-train. If a single block of data is acquired, nonrepeatable or spurious data can be

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introduced into the data base. The microprocessor should be able to acquire multiple blocks of data, average the total, and store the averaged value. Basically, this approach will enable the data acquisition unit to automatically reject any spurious data and provide reliable data for trending and analysis. Systems that rely on a single block of data will severely limit the accuracy and repeatability of acquired data. They will also limit the benefits that can be derived from the program. The microprocessor should also have electronic circuitry that automatically checks each data set and block of data for accuracy and rejects any spurious data that may occur. Auto-rejection circuitry is available in several of the commercially available systems. Coupled with multiple block averaging, this auto-rejection circuitry assures maximum accuracy and repeatability of acquired data. A few of the microprocessor-based systems require the user to input the maximum scale that is used to acquire data. This will severely limit the accuracy of data. Setting the scale too high will prevent acquisition of factual machine data. A setting that is too low will not capture any high-energy frequency components that may be generated by the machine-train. Therefore, the microprocessor should have auto-scaling capability to ensure accurate data. Vibration data can be distorted by high-frequency components that fold over into the lower frequencies of a machine's signature. Even though these aliased frequency components appear real, they do not exist in the machine. Low-frequency components can also distort the mid-range signature of a machine in the same manner as high frequency. The microprocessor selected for vibration should include a full range of anti-aliasing filters to prevent the distortion of machine signatures. This feature also applies to nonvibration measurements. For example, pressure readings require the averaging capability to prevent spurious readings. Slight fluctuations in line or vessel pressure are normal in most plant systems. Without the averaging capability, the microprocessor cannot acquire an accurate reading of the true system pressure.

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Type of Data A l e r t and A l a r m Limits

The microprocessor should include the ability to automatically alert the user to changes in machine, equipment, or system condition. Most of the predictive maintenance techniques rely on a change in the operating condition of plant equipment to identify an incipient problem. Therefore, the system should be able to analyze data and report any change in the monitoring parameters that were established as part of the data-base development. Predictive maintenance systems use two methods of detecting a change in the operating condition of plant equipment: static and dynamic. Static alert and alarm limits are preselected thresholds that are downloaded into the microprocessor. If the measurement parameters exceed the preset limit, an alarm is displayed. This type of monitoring does not consider the rate of change or historical trends of a machine and therefore cannot anticipate when the alarm will be reached. The second method uses dynamic limits that monitor the rate of change in the measurement parameters. This type of monitoring can detect minor deviations in the rate when a machine or system is deteriorating and anticipate when an alarm will be reached. The use of dynamic limits will greatly enhance the automatic diagnostics capabilities of a predictive maintenance system and reduce the manual effort required to gain maximum benefits. Other Features

Data Storage and Retrieval The microprocessor must be able to acquire and store large amounts of data. The memory capacities of the various predictive maintenance systems vary. As a minimum, the system must be able to store a full eight hours of data before transferring them to the host computer. The actual memory requirements will depend on the type of data acquired. For example, a system used to acquire vibration data would need enough memory to store about 1,000 overall read-

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ings, or 400 full signatures. Process monitoring would require a minimum of 1,000 readings to meet the minimum requirements.

Data Transfer The data acquisition unit will not be used for long-term data storage. Therefore, it must be able to reliably transfer data into the host computer. The actual time required for transferring the microprocessor's data into the host computer is the only nonproductive time of the data acquisition unit. This time cannot be used for acquiring additional data. Therefore, the transfer time should be kept to a minimum. Most of the available systems use an RS 232 communication protocol that will allow data transfer at rates of up to 19,200 baud. The time required to dump the full memory of a typical microprocessor can be thirty minutes or more. Some of the systems have incorporated an independent method of transferring data that eliminates the dead time altogether. These systems transfer stored data from the data logger into a battery-backed memory, bypassing the RS 232 link. Using this technique, data can be transferred at more than 350,000 baud and will reduce the nonproductive time to a few minutes. The microprocessor should also be able to support modem communication with remote computers. This feature will enable multiple plant operation and direct access to third-party diagnostic and analysis support. Data can be transferred anywhere in the world using this technique. Not all predictive maintenance systems use a true RS 232 communication protocol or support modem communication. These systems can severely limit the capabilities of your program. The various predictive maintenance techniques will add other specifications for an acceptable data acquisition unit. T H E HOST C O M P U T E R

This computer provides all the data management, storage, report generation, and analysis capabilities of the predictive maintenance program. Therefore, care should be exercised during the selection

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process. This is especially true if multiple technologies will be used within the predictive maintenance program. Each predictive maintenance system will have a unique host-computer specification that will include hardware configuration, computer operating system, harddisk memory requirements, and many other things. This can become a serious, if not catastrophic, problem. You may find that one system requires a special printer, that is not compatible with other programs, to provide hard copies of reports or graphic data. One program may be compatible with PC-DOS, while another requires a totally different operating program. Therefore, you should develop a complete computer specification sheet for each of the predictive maintenance systems that will be used. A comparison of the list will provide a compatible computer configuration that will support each of the techniques. If this is not possible, you may have to reconsider your choice of techniques. Computers, like plant equipment, fail. Therefore, the use of a commercially available computer is recommended. The critical considerations include availability of repair parts and local vendor support. Most of the individual predictive maintenance techniques will not require a dedicated computer. Therefore, there is usually sufficient storage and computing capacity to handle several, if not all, of the required techniques and still leave room for other support programs (word processing, data-base management, and so on). Use of commercially available PC computers provide the user with the option of including these auxiliary programs in the host computer. The actual configuration of the host computer will depend on the specific requirements of the predictive maintenance techniques that will be used. Therefore, I will not attempt to establish guidelines for selection. THE SOFTWARE

The software program provided with each predictive maintenance system is the heart of a successful program. It is also the hardest to evaluate before purchase. The methodology used by vendors of pre-

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dictive maintenance systems varies greatly. Many software programs appear to have all the capabilities required to meet the demands of a total plant predictive maintenance program. However, after close inspection (usually after purchase), they are found to be lacking. Software is also the biggest potential limiting factor of a program. Even though all vendors use some form of formal computer language (FORTRAN, COBOL, BASIC), their programs are normally not interchangeable with other programs. The apparently simple task of having one computer program communicate with another can often be impossible. This lack of compatibility between various computer programs prohibits transferring a predictive maintenance data base from one vendor's system into a system manufactured by another vendor. The result is that once a predictive maintenance program is started, a plant cannot change to another system without losing the data already developed in the initial program. As a minimum, the software program should provide automatic data-base management, automatic trending, automatic report generation, and simplified diagnostics. As in the case of the microprocessor used to acquire data, the software must be user friendly. User-Friendly Operation The software program should be menu-driven with clear on-line user instructions. The program should protect the user from distorting or deleting stored data. Some of the predictive maintenance systems are written in DBASE software shells. Even though these programs provide a knowledgeable user with the ability to modify or customize the structure of the program (report formats, and so on), they also provide the means to distort or destroy stored data. A singlekey entry can totally destroy years of stored data. Protection should be built into the program to limit the user's ability to modify or delete data and to prevent accidental data-base damage. The program should have a clear, plain-language user's manual that provides the logic and specific instructions required to set up and use the program.

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Automatic Trending The software program should be capable of automatically storing all acquired data and updating the trends of all variables. This capability should include multiple parameters, not just a broadband or single variable. This will enable the user to display trends of all variables that affect plant operations.

Automatic Report Generation Report generation will be an important part of the predictive maintenance program. Maximum flexibility in format and detail is important to program success. The system should be able to automatically generate reports at multiple levels of detail. As a minimum, the system should be able to report: (1) a listing of machine-trains or other plant equipment that has exceeded or is projected to exceed one or more alarm limits, (2) a projection to probable failure based on the historical data and last measurement, and (3) a listing of missed measurement points, machines overdue for monitoring, and other p r o g r a m m a n a g e m e n t information. These reports act as reminders to ensure that the program is maintained properly. Most of the microprocessor-based systems support visual observations as part of their approach to predictive maintenance. This report provides hard copies of the visual observations, as well as maintaining the information in the computer's data base. Equipment history reports should also be available. These reports provide long-term data about the condition of plant equipment and are valuable for analysis.

Simplified Diagnostics Identification of specific failure modes of plant equipment requires manual analysis of data stored in the computer's memory. The software program should be able to display, modify, and compare stored data in a manner that simplifies the analysis of the actual operating condition of the equipment. As a minimum, the program should be

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able to directly compare data from similar machines, normalize data into compatible units, and display changes in machine parameters (vibration, process, and so on).

TRANSDUCERS The final portion of a predictive maintenance system is the transducer, which will be used to acquire data from plant equipment. Because I have assumed that a microprocessor-based system will be used, I will limit this discussion to those sensors that can be used with this type of system. Acquiring accurate vibration and process data will require several types of transducers. Therefore, the system must be capable of accepting input from as many different types of transducers as possible. Any limitation of compatible transducers can become a serious limiting factor. This should eliminate systems that will only accept inputs from a single type of transducer. Other systems are limited to a relatively small range of transducers that will also prohibit maximum utilization of the system. Selection of the specific transducers required to monitor the mechanical condition (vibration) and process parameters (flow, pressure, and so on) will also deserve special consideration.

PREDICTIVE

MAINTENANCE

ORGANIZATION

The labor-power requirements of a total plant predictive maintenance program depend on the types of predictive maintenance technologies selected for the program and the size, complexity, and layout of the plant. T Y P E S OF O R G A N I Z A T I O N

A number of organizational structures can support a total plant predictive maintenance program. However, all the variations can be broken down into four categories: central, distributed (division), combined, and contractors.

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Central Predictive Group Staffing the total plant predictive program with a single, central group of technicians and analysts has an advantage, from a management and control standpoint. Because the entire group is centralized and under one manager, it is somewhat easier to schedule tasks and effectively manage the organization. The disadvantage is that there is no direct involvement of the production divisions. This may create an adversarial relationship between the central group and each of the production areas. If a central group is the most cost effective for your plant, care must be taken to instill a team concept with the assigned maintenance group and production management of each group within the plant. One method might be to assign a team, consisting of a technician and analyst, to each division. The team, as part of their normal assignments, should take an active part in the maintenance activities, such as planning, for the assigned plant area.

Division Staff The predictive maintenance team of technicians and analysts can also be assigned to specific plant areas. In this type of organization, the team reports directly to the division manager and becomes a more integral part of that area or division. This approach has a distinct advantage in that it tends to instill a sense of ownership within the predictive maintenance personnel and greatly improves communication with division maintenance personnel. The disadvantage is that this type of organization tends to increase the total number of personnel required to fully implement and maintain the program. Each division must staff the team so that continuous coverage can be provided. Typically, at least one additional technician and one analyst are required just to cover for vacation, illness, and other reasons that result in temporary staff reductions. Combined Staff The most effective method of staffing a total mill predictive maintenance program is a combination of a central core of analysts and

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assigned full-time division technicians. This approach provides direct participation of each production division. The system-specific knowledge resident in each production (and assigned maintenance) division is critical to achieving maximum improvement from the program. Therefore, it is essential that each division participate fully in the program. The use of combined staffs for the predictive maintenance program will provide the integration of knowledge required to achieve success. The disadvantages to the combined-team approach are management and control. Because the assigned division data collectors report through the line organization to the division manager, and the central analyst group reports through the operation services organization, coordination of efforts will be much more difficult. Contractors The use of predictive maintenance contractors is not recommended. Although this approach may seem less expensive than the total burdened labor cost of an in-house team, it cannot provide the same level of benefits. In addition, the use of outside contractors precludes building a sense of ownership within the predictive team or plant.

DEVELOPING A PREDICTIVE MAINTENANCE

PROGRAM

With the tasks of selecting technologies and purchasing the instrumentation required for a total plant predictive maintenance program complete, the next task is to implement the program, addressing the areas listed below.

DATA-BASE DEVELOPMENT A comprehensive data base for each critical machine in the program is essential for long-term success and proper utilization of manpower. This effort will require considerable manpower to complete.

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Specific design and installation data for each machine will be required for this effort. Because of the age of most machinery and equipment within a typical plant, obtaining accurate machine data may be difficult. Therefore, it may be necessary to establish temporary data bases, based on available information, for some of the selected machine-trains. If this is the case, do not forget to add the missing data as soon as they become available. In the initial phase of development, traditional vibration-analysis techniques will be utilized for all mechanical equipment, and thermography (infrared) techniques for all electrical equipment. The decision to limit the initial effort to these two techniques is predicated on the short-term benefits they can provide. After completion of the initial phase, additional predictive maintenance techniques will be added to provide machine-specific monitoring capabilities. It is anticipated that the inclusion of operating dynamics, process parameters, and other techniques will be incorporated into the vibration-monitoring program for all mechanical equipment. Methods specifically designed for electric motors, switchgear, and other electrical components will also be added to the thermographic program. Predicated on all available machines, equipment, and system design data, a series of data bases will be developed and stored in dedicated predictive-maintenance computers. These data bases will become the long-term sources of machine-condition histories. But data-base development is not complete. Sufficient data will not be currently available for all machinery selected for the program. As an ongoing effort, the data bases will be modified, as information becomes available. PROBLEM

IDENTIFICATION

AND REPORTING

A report will be prepared for each division (or area) each month that defines specific maintenance tasks that are required to correct incipient problems identified by the monthly data acquisition and analysis program. These reports will be submitted within three working days after the completion of data acquisition. The format of the report will be designed to reduce the amount of paperwork neces-

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sary to properly maintain accurate communication between the central analysis group and the production division (through coordinators). Each report will provide a prioritized list of specific maintenance or inspection tasks that are required to verify or correct developing problems. Communication between the predictive maintenance team and area maintenance must be two-way. The division, through its coordinator, must provide a timely response to the action items included in each monthly report. For each report, the division coordinator will define what and when corrective actions are taken for each item on the report. If the division elects not to follow an item on the report, the coordinator must notify maintenance development so that the reasons can be recorded in the central maintenance history file. Divisions' responses to the monthly reports must be returned no later than two weeks after receipt of the reports. COMMUNICATION

To achieve maximum benefit from the predictive maintenance program, direct communication must occur between the central data acquisition/analysis team and each division. To accomplish a regular dialogue and provide direct support from the central team, an analyst will be assigned responsibility for each division or area within the mill. Assigned analysts will attend all scheduled maintenance-planning meetings for their assigned divisions or areas. They will also be available for call-out support a n d / o r any other direct support required by their assigned production groups. The objective of the program concept is to create a team effort by the production division and central support group. BASELINE

DATA ACQUISITION AND ANALYSIS

The next task of the predictive maintenance program will determine the initial operating condition of all selected critical mill equipment. Full vibration signatures will be acquired for all mechanical equipment included in the program, and color, computer-enhanced thermal images taken for electrical equipment.

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The analyses will result in a series of reports that will: (1) identify specific problems, (2) provide specific corrective actions, and (3) establish priorities (based on problem severity) for maintenance actions. REGULAR

MONITORING

AND ANALYSIS

Regular monitoring and analysis of the operating condition of critical mill equipment is an absolute requirement of the Total Plant Performance Management program. Therefore, all critical equipment, machinery, and process systems will be monitored at regular intervals. The actual interval (frequency) for monitoring machinery will be determined by the unique characteristics of each machine included in the program. The maximum interval for all equipment in the program will be thirty days. Based on failure history for steel-mill equipment, monitoring intervals greater than thirty days dramatically increase the potential for undetected, catastrophic failure. FAILURE

ANALYSIS

TEAMS

Resolving all the factors that limit availability, reliability, and maintainability of the mill will require a focused effort to identify and eliminate all mechanical, electrical, and process problems associated with critical process machinery. Therefore, the program will include a plan for resolution of all failures that occur within the mill. Failure analysis teams will be created for each catastrophic failure a n d / o r chronic problem that occurs within the mill. These teams will consist of responsible representatives from operation services, area (or division) production, and maintenance, and when required the TPPM program advisor will also serve on the teams. Additional team members (such as shops personnel and vendors) will be added to the teams when appropriate. The team concept has proven effective in resolving specific chronic problems and in determining the true causes of failures. As part of the program, specific methods will be developed that will be used by the failure analysis teams to isolate the root-causes of chronic problems and/or catastrophic failures. Three methods will

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be used to identify chronic process problems: (1) delay reports, (2) failure histories, and (3) catastrophic failures.

Delay Reports The predictive maintenance program manager should evaluate the delay reports on a daily basis. This evaluation serves two purposes: (1) it identifies any problems that were not detected by the predictive maintenance program, and (2) it identifies potential chronic process problems.

Failure Histories As part of the predictive maintenance program, maintenance histories (failures) are tracked and recorded by classification. The tracking program will identify any problem areas (such as beatings) that represent chronic problems. Failure analysis teams will be formed to resolve each of the chronic problems identified by the tracking program. When methods are developed to resolve each of these problems, a report will be generated that will notify all affected mill functions of the corrective actions.

Catastrophic Failures All catastrophic failures will be evaluated by an assigned failure analysis team, and a report will be generated that will notify all affected functions of the best method to prevent future failures. Because many of the corrective actions developed by the failure analysis teams will require redesign and/or a change in purchasing and engineering, communication with these functions within the mill is critical. MACHINE HISTORY DATA BASE

Accurate, timely knowledge of the past performance and maintenance history of all critical machinery within the mill is critical to the long-term success of the program. This fact, coupled with the mas-

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sive amount of data that will be generated by the preventive/predictive maintenance program, creates a serious requirement for a central data base that will include all pertinent information. The most logical location for the central machine history data base is in maintenance development because this function is the focal point for all preventive/predictive monitoring activity. The following should be included in this data center: 1. Complete machine-train descriptions 2. Trends of regular predictive monitoring data 3. History of incipient problems 4. History of maintenance and/or repairs 5. Mean-time-between-failure (MTBF) 6. Mean-time-to-repair (MTTR) 7. Mechanical delays (hours and reason) 8. Electrical delays (hours and reason) 9. Actual vs. planned repair outages (hours) These items are discussed in more depth in the next few sections. Other relative data will be added to the central data base as identified.

Complete Machine-train Descriptions The success of the preventive/predictive maintenance program will depend on the accuracy of design information regarding each machine-train that is included in the program. Therefore, the central data base will include specific data about each machine-train. Included in this data base will be a complete, accurate description of the actual construction (beatings, gears, and so on) and design operating condition (flows, pressures, and so on). These data will become the baseline for the initial "best" operating dynamics for each of the critical machines in the program. In addition to the design information, the central data base will include a monitoring-parameters data sheet for each machine-train. Information on this data sheet will include: (1) specific monitoring methods (vibration, thermography, process), (2) alert/alarm limits for each method, and (3) monitoring frequency.

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Trends of Regular Predictive Monitoring Data The computer-aided predictive maintenance tools selected for the program include the ability to automatically trend the changing condition of critical machinery in the program. The central data base will maintain life-of-program trends for all critical equipment. These data will be used to identify potential chronic problem areas and as part of the regular analysis of operating condition.

History of Incipient Problems The tracking report and monthly reports generated by the predictive maintenance team should provide specific information that identifies incipient problems. These data will be added to the central data base for future reference. Trends of specific failure modes, failure frequencies, and other information will provide the ability to identify chronic problems.

History of Maintenance and/or Repairs Accurate information about the actual repairs a n d / o r maintenance tasks performed on individual machine-trains in the program is not available in the central preventive/predictive maintenance group. Therefore, regular reporting of this information must come from the divisions. One of the program tasks assigned to division and area maintenance personnel (managers) is monthly reporting of actual repairs a n d / o r maintenance performed on each machine-train included in the program. Some of these instances can be included in the feedback portion of the monthly report generated by the predictive maintenance team. This information must be transmitted to the central data base.

Mean-Time-Between-Failure ( M T B F ) The only indication of failure within the central predictive maintenance group is the daily delay reports. The information included in

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these reports does not include enough data to log the actual MTBF. The task of tracking operating life (MTBF) will be assigned to area or division maintenance. As part of this program, a standardized (total plant) format will be developed that will accurately track the data required to determine MTBF. Each division will submit a monthly report that defines each failure of critical equipment within its area of responsibility. This data will be entered into the central data base for trending and future analysis. A standard format report will also be developed to track actual time required to repair each machine a n d / o r process system in the total mill program. Division or area maintenance will be required to complete the tracking forms in a timely manner and submit a monthly report (through the division manager) to maintenance development for inclusion in the central data base. Mean-Time-to-Repair (MTTR) M T T R differs from mean-time-between-failure in that it tracks the interval between repairs instead of failures. The initial intent of any improvement program is to prevent failures of critical plant systems. Therefore, the MTBF statistic should disappear within the first year or two of the program. The mean-time-to-repair will replace the MTBF statistic with one that tracks repairs and rebuilds. The M T T R statistic is also important for another reason. As machinery approaches the end of its useful life, the interval between major repairs will decrease. This is normally the first indication that that specific machine should be replaced rather than repaired. By tracking the M T T R of critical plant equipment, the analyst or planner can quantify the increase in frequency and cost of repair associated with each piece of equipment. These data can then be used as part of a procurement justification package for a replacement machine.

Mechanical/Electrical Delays The frequency of, specific reason for, and other pertinent information about all mechanical delays are valuable pieces of information.

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Therefore, these data must also be included in the central data base. Current delay reports will contain some of the information required, but may not be accurate enough for long-term needs. The current delay-report format and implementation will be evaluated and modified (if required). Assuming that accurate, complete data is included in the delay reports, these data can be directly entered into the central data base for future use.

Actual vs. Planned Repair Outages Scheduled maintenance a n d / o r repair outages represent a substantial loss of production capacity and are a key target for improvement. Therefore, it is critical that the central data base includes sufficient data to quantify and track actual versus planned outage time. The information derived from this data set will provide the means to: (1) track maintenance planning/scheduling efficiency, (2) spot potential problem areas, and (3) measure improvement generated by the program. TRAINING

Implementation and maintenance of a comprehensive, total-mill preventive/predictive maintenance program will require basic skill levels that do not currently exist at the mill. Therefore, a critical part of the Phase I effort will be in the area of training. The issue of training, as part of Phase I, is limited to the following: (1) training a core of technicians and analysts in the basic skills required to set up and maintain a predictive maintenance program, (2) providing basic maintenance skills to assigned and central maintenance personnel, and (3) providing basic inspection skills to machine operators. The long-term (TPPM) program will involve additional training for all employees within the plant.

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OF PROGRAM

Continuous improvement programs must be dynamic. It is almost impossible to develop an initial program plan that will anticipate every problem, limiting factor, or outside influence that has had or will have an impact on plant performance. Therefore, it is essential that the initial plan include a mechanism for constant review and modification of the plan. In most programs, the first formal review and modification of the program plan should be scheduled ninety days after the actual start date. This quarterly schedule should continue for at least the first year and then be adjusted based on the program's progress. The program coordinator, with support from the steering committee and program advisor, should be assigned the responsibility for the reviews a n d / o r modifications. To completely resolve the issue of high maintenance cost, other functions within the plant must also be modified. Design, purchasing, and operation methods have a direct impact on maintainability and maintenance costs. Therefore, the philosophies and methods used by each of these functions must also be modified to support maintenance-free operation before optimum plant performance can be achieved. New procedures a n d / o r methods must be developed that will ensure maximum availability, maximum production capacity, and minimum maintenance before the lowest possible maintenance costs become a reality. The next task of the maintenance improvement phase of a Total Plant Performance Management program will be the implementation of a condition-based monitoring program that will routinely evaluate the operating condition of all critical plant systems. Data from this program will provide the ability to detect incipient problems, determine required corrective actions, and accurately schedule maintenance activities on an as-needed basis. The TPPM program should be designed to address each of these factors and reduce their impact on the operating efficiency of the plant. Correction of all of the contributing factors cannot be implemented at once.

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CONCLUSION Change, especially of the magnitude that is needed in most plants, is not easy. At times it can be traumatic, but from our perspective it is an absolute necessity. If America is to survive as an industrial nation, we must take whatever steps are necessary to be competitive. A few last words of advice: If you attempt to implement a total plant improvement program, accept the fact that traditional methods and plant culture must change before substantial, sustainable benefit can be achieved. If you hope to achieve optimum performance from your plant, you m u s t make an absolute, total culture change. Reliance on core groups or quick-fix programs will not work. Optimum performance requires an absolute commitment and a coordinated effort from the entire work force. Is it worth the effort? Absolutely! Total Plant Performance Management will provide the means to accomplish an almost immediate r e t u r n on i n v e s t m e n t and will create an e n v i r o n m e n t that will improve the overall performance of your plant each day. The unique, holistic perspective of the program will permit the use of the functional organization as the implementer and will create a sense of teamwork that cannot be stopped. Just look at the results that have been achieved by other plants, many with problems much more severe than yours. Remember, plants that had histories of net-profit-before-tax losses in excess of $100 million were able to post $100 million profit in the first year. Now, using the TPPM program you've learned about in this book, you can finally get to work and do the same in your plant.

Appendix

Sample TPPM Program Plan Total Plant Performance Management is a plant-specific program, but I would like to provide an example of a typical program overview plan. This appendix provides the initial program plan manual developed for a large integrated steel mill. It will give you an idea of the breadth of the total plant approach. V

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The (company) Corporation strives to be" 9 A profitable company that earns an adequate return for its shareholders and provides sufficient capital to assure its long-term success. 9 An innovative steel company that clearly distinguishes itself as the industry leader in providing superior quality and service to its customers, while continuously reducing costs to achieve a status of low-cost producer. 9 A company that has respect for all employees, creates an atmosphere that motivates employees to fully utilize their talents, encourages all employees to work together effectively, and promptly recognizes and rewards each employee for contributions to the overall success of the company. 244

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9 A company that values diversity in its work force, fosters a safe and healthy workplace, is environmentally responsible, and at all times conducts itself in an ethical manner. 9 A company in which each employee takes pride in being an important and contributing member. To achieve the vision, we must significantly elevate our performance standards and consistently achieve these new levels. None of these objectives alone will be sufficient for success; together, however, they will allow us to maximize and balance the benefits to all our employees, customers, shareholders, and communities. TPPM is an acronym, which symbolizes the Total Plant Performance Management of (company) Corporation. The TPPM program provides a work environment that fosters decisions for continuously improved quality and relies on "people" involvement. TPPM symbolizes the efforts of its employees in a drive to reach the top, to be the best ~ a drive of never-ending improvement in order to satisfy the needs of (company) Corporation's customers. The (company) Corporation's Total Plant Performance Management manual sets forth the uniform system for the continuous improvement and control requirements for product, process, and service quality for all plants. The responsibilities, authorities, accountabilities, activities, and procedures in this manual describe the TPPM quality system necessary to implement the corporate quality policy of world-class quality and continuous improvement. The TPPM system is used throughout the organization. The policies and requirements of this manual describe the manner in which the quality activities function both individually and collectively as a system. The TPPM system emphasizes a dynamic system of employee

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commitment to process optimization and problem resolution, with continuous quality improvement and customer satisfaction as its goals. The TPPM quality system is an integral part of the total business management of (company) Corporation. The TPPM quality system described in this manual has the concurrence and full endorsement of the following:

President~CEO (company) Corporation

Vice President--Asst. COO

Sr. Vice President~CFO President

Vice President--Raw Materials and Diversified Business

Vice President--Human Resources

Division Vice President The quality policy of (company) Corporation is encompassed by the vision statement and is as follows: The vision of (company) Corporation is to be an innovative steel company that clearly distinguishes itself as the industry leader in

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providing superior quality and service to its customers, while continuously reducing costs to achieve a status of low-cost producer. The T P P M p r o g r a m defines the organizational structure, responsibilities, procedures, and processes for implementing quality management that ensures the product meets or exceeds specified requirements. The (company) Corporation has established and will maintain a documented quality system as a means for ensuring that the product conforms to specified requirements. This will include: 9 Preparation of a documented TPPM manual and procedures in accordance with the requirements of ISO 9002. Effective implementation of the documented TPPM manual and procedures. Documented quality procedures and work instructions are prepared and maintained by each plant. They are developed, issued, and maintained to implement quality policies, objectives, and customer requirements.

President and CEO

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INVOLVEMENT

The TPPM program is committed, through management leadership, to provide an environment that encourages employee involvement and self-improvement, and that motivates employees to achieve the designated goals and objectives. This involvement includes: open lines of communication, training, team participation, decision-making, procedure development and review, process control, exposure to customer wants and needs, interfacing through tours and customer visits, and auditing. TPPM program participation is promoted through employee recognition. 1.1

QUALITY

IMPROVEMENT

PLAN

Each plant maintains a formal quality improvement plan. As a minimum, the plan contains short- and long-term continuous improvement objectives. 1.2 ADMINISTRATION/RESPONSIBILITY

The TPPM program contains the required executive, operating, quality assurance, and other staff organizations to assure the attainment of the corporate quality objectives and policy. 1.2.1

MANAGEMENT

REPRESENTATIVE

The (company) Corporation executive quality board is responsible for appointing the management representative, who irrespective of other responsibilities, will have defined authority and responsibility for ensuring that the requirements of the TPPM program and ISO standards are implemented and maintained.

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RESPONSIBILITY

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AND AUTHORITY

The responsibility, authority, and interrelation of all personnel who manage, perform, and verify work effecting quality are defined below, particularly for the benefit of personnel who need the organizational freedom and authority to: 9 Initiate action to prevent the occurrence of product nonconformity. 9 Identify and record any product quality problems. 9 Initiate, recommend, or provide solutions through designated channels. 9 Verify the implementation of solutions. 9 Control further processing, delivery, or installation of nonconforming product until deficiency or unsatisfactory condition has been corrected. The structure of this organization is shown in the organizational chart section. Their related authority, responsibility, and accountability are defined as follows: President of (company) Corporation is responsible for delegating the authority for defining, achieving, and sustaining the objectives of the TPPM program to the corporate steering committee. Corporate steering committee will be made up of the executive vice president of raw materials and diversified businesses, the vice president of operations, and the vice president of sales. The corporate steering committee has the overall responsibility for the development, implementation, and maintenance of the TPPM program. The corporate steering committee will have final authority for management review/audit of the TPPM qual-

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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

ity system to comply with ISO 9000 requirements. The committee appoints the director of TPPM as the management representative for the TPPM program. The corporate steering committee will meet every three months. Executive vice president of raw materials and diversified businesses is a member of the corporate steering committee. This position reports to the President of (company) Corporation and has the overall responsibility for production and operations at (company) Corporation and other diversified businesses, as well as procurements, distribution, and sales. This position is also responsible for implementing and maintaining the TPPM program and for assuring adherence of the company to specified quality standards. Vice president of operations is a member of the corporate steering committee. This position reports to the president of (company) Corporation and has the overall responsibility for the production and operations at , , and plants. This position is responsible for achieving and sustaining the objectives of the TPPM program. Vice president of sales is a member of the corporate steering committee. This position reports to the executive vice president of commercial and is responsible for assuring that orders entered on the mill are compatible with customer specifications, mill capabilities, technical society or industry standards, and specified quality requirements. Order entry must be consistent with the authorized product manual instructions. This position is responsible for assisting and supporting business-planning functions and operations functions in meeting quality, production, and delivery scheduling requirements. This position is responsible for supporting sales and marketing's efforts and objectives in upgrading facilities to satisfy ongoing and anticipated product and market demands.

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Executive vice president of commercial is responsible for the overall operation of commercial sales and marketing, for developing product standards, and for supporting business-planning activities. This position is responsible for interpreting and clarifying customer order requirements, providing technical support to the customer, and obtaining customer feedback on product quality and services. Vice president of technology and m a n a g e m e n t services reports to the president of (company) Corporation and is responsible for providing raw materials, consumables, equipment, parts, and all purchased supplies and services to conform to the specifications of the operating facilities. This position is responsible for developing, implementing, and maintaining an effective, documented supplier program. This position is also responsible for supplying engineering and technical support to achieve the goals and objectives of the TPPM program. Director of TPPM will have direct responsibility to ensure that the requirements of this TPPM program manual and ISO standards are developed, implemented, and maintained. The director of TPPM will also be the corporate management representative, appointed by the corporate steering committee, and will have overall responsibility for administration, monitoring, and oversight of the TPPM program management review/audit process. General manager of systems and process control reports to the vice president of technology and management services and is responsible for the development of systems that meet the needs of the TPPM program. General manager of engineering reports to the vice president of technology and management services and is responsible for supplying engineering and technical support to achieve the goals and objectives of the TPPM program, including controlling and

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verifying the design of the facilities and equipment to meet customer requirements. General manager of research reports to the vice president of technology and management services and is responsible for supplying technical support to achieve the goals and objectives of the TPPM program.

General manager of marketing and planning is responsible for supporting sales and marketing's efforts and objectives in upgrading facilities to satisfy ongoing and anticipated product and market demands. General manager of sales has the overall responsibility for district sales/outside sales, customer service, and customer technical service. Manager of customer technical services reports to the general manager of sales and is responsible for interpreting and clarifying customer order requirements and developing and issuing a setup letter to the plants regarding new orders. This position supplies technical support to the customer and provides customer feedback to the operation. Manager of purchasing quality and administration has the responsibility for the development and implementation of the U.S. Steel Supplier Quality Process. Vice president and general manager reports to the president and chief operating officer and is responsible for developing, implementing, achieving, and sustaining the objectives of the TPPM program at the plant level, including appointing the plant management representative. This position is responsible for the following: identifying and planning production; providing information, resources, and environment for employees; and communicating the objectives and commitment to ensure that

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product and process quality requirements are consistently met or exceeded. This position is responsible for developing short- and long-term continuous improvement objectives. In addition, this responsibility includes establishing and maintaining a plant TPPM quality steering team. This team will meet at least every six months as a minimum and will be used as a vehicle for directing the TPPM program within the vice president and general manager's duties. This position is also responsible for directing and empowering the plant TPPM managers to develop and implement specified elements of the TPPM program. Plant quality assurance manager reports to the vice president and general manager and is responsible for implementing, maintaining, and administering the plant quality assurance functions and activities. This position is responsible for, and shall designate and supervise qualified individuals in the following: initiating action to prevent the occurrence of nonconforming product; identifying and recording quality problems; and initiating, recommending, and providing solutions to quality problems. This position oversees the following TPPM program items: developing the plant quality procedures and continuous improvement objectives in conjunction with the vice president and general manager; developing inspection procedures, such as in-process and final inspection procedures; and identifying and maintaining quality records. T P P M division coordinators are responsible for helping to implement and develop specific areas and activities of the TPPM program. They will also be responsible for ensuring that the specified elements of the plant TPPM program are documented in the plant quality procedures. Responsibilities also include coordinating the implementation of the elements of the system and making recommendations to the division steering committee; providing ongoing communication to employees, suppliers, and customers regarding TPPM developments; seeking out resources, material, and training to provide growth and mainte-

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nance of the system; and reporting the status of system implementation at the plant level.

Plant management representative has the defined authority and responsibility for ensuring that the requirements of the plant TPPM program and ISO standard are implemented and maintained. This position will also have responsibility for the administration and oversight of the management review/audit process at the plant level. This position will have dotted-line, or indirect and functional, reporting responsibility to the director of TPPM for periodic reporting of plant-level management review/audit status. Plant division managers of operations, maintenance, and services report to the vice president and general manager and are responsible for the quality of the product or services provided by their divisions and the implementation of the TPPM program in their divisions. This position is also required to hold a quarterly TPPM program meeting and address short- and longterm quality objectives. Area managers of operations, maintenance, service, and quality assurance have the shared responsibility for the implementation and documentation of the TPPM program in their areas of duty. Their job requirements are as follows: establishing a system for maintaining the plant facilities, equipment, and property; implementing provisions to control and maintain inspection, measuring, and test equipment; retaining and evaluating the performance data of purchased products and services and feeding those data back to purchasing; assisting in the disposition of nonconforming items; and identifying training requirements for all their employees. In addition, they are encouraged to establish employee involvement teams. Shift manager is responsible for the operation of the equipment in accordance with written standards and practices, which entails

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ensuring that the employees are properly trained in the operation of the equipment and that statistical techniques are properly used when required. In addition, this position also ensures that the product meets the basic standards and specifications and reports on daily operations of the facilities. This position is also responsible for implementing key elements of the TPPM program, identifying key job characteristics and evaluating employees to determine when they are qualified to perform specific tasks. They are also encouraged to participate in employee involvement teams. Division TPPM steering committees report to the vice president and general manager, and are responsible for overseeing the application of the elements of the TPPM program and for ensuring that they are properly implemented. Employees are responsible for adhering to the established standards and practices and for making quality a top priority. They are encouraged to participate in establishing standard quality practices and in-process standards, and to participate in problem-solving teams that identify the root-causes of problems and implement any changes or actions. 1.3

ORGANIZATION

CHARTS

The organization charts for the (company) Corporation represent personnel who manage, perform, and verify work-affecting quality. 1 .4 ENVIRONMENT 1.4.1

SAFETY

All TPPM program practices and procedures are consistent with the corporate safety program.

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1.4.2 HOUSEKEEPING

Management is responsible for maintaining the plant facilities, equipment, and property in a state that provides the employees a safe, efficient place to work. Good housekeeping is an essential element needed to achieve maximum productivity, quality, and efficiency. All employees have a responsibility for housekeeping. Management, to ensure that all areas are clean and well-maintained, delegates this responsibility. 1.5

TRA! N ! NG

Management is responsible for providing the necessary instruction to all employees regarding their on-the-job responsibilities. The employees are trained not only in the safe and proper operation of the equipment but also in policy and objectives for, and commitment to, quality. This requirement is to ensure that the quality policy is understood, implemented, and maintained at all levels in the (company) Corporation organization. The TPPM program requires that training procedures are established, implemented, and maintained to provide adequate training for all employees. This program is established to train employees and upgrade their skills. The employees are trained in the TPPM program and its tools to enable employees to improve quality and to develop and/or enhance their competence. Employees performing specific assigned tasks are qualified by an evaluation by management on the basis of appropriate education, experience, and on-the-job training (OJT) as required. Appropriate records of training are maintained. 1.6

COMMUNICATION

A system to promote effective communication among all employees in the organization is required. Employees are kept

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informed concerning current significant business facets and their responsibilities and roles. Employees are solicited for their opinions and ideas. These communications are required throughout the entire organization and are present in some of the following forms: regularly scheduled meetings, tours, bulletin boards, newsletters, and problem solving or working teams.

Corporate TPPM Coordinator

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PROCESS

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CONTROL

The TPPM program requires that plants identify and plan the production that directly affects quality and ensures that these processes are carried out under controlled conditions. The controlled conditions will include the following: Documented work instructions defining the manner of production, where the absence of such instructions would adversely affect quality Use of suitable production equipment, suitable working environment, and compliance with reference standards/codes and procedures Monitoring and control of suitable process and product characteristics during production 9 Approval of processes and equipment as appropriate * Criteria for workmanship that is stipulated to the greatest practicable extent, in written standards or by means of representative samples 2.0.1

KEY C H A R A C T E R I S T I C S

A key characteristic is defined as a chosen manufacturing or product variable attribute that receives the affirmative in all cases when asking the following questions: 9 Can it be measured or monitored? 9 Can it be controlled? 9 Does it have a direct effect upon product quality, customer satisfaction, or machine operation? 9 Is someone clearly responsible?

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Key characteristics are selected by muhidiscipline teams familiar with the process, product, and customer needs. An index of these characteristics is established along with a procedure for review and revision. 2.0.2

KEY CHARACTERISTIC GUIDELINES

Key characteristic guidelines summarize the process or product standard and the method for controlling the key characteristic. These guidelines are summarized by work station and include the following elements: 9 Defined key characteristics 9 Standard limits for the key characteristic * Checking frequency 9 Checking method 9 Quantity checked 9 Corrective action priority (severity) 9 Responsibility o Statistical quality procedure (SQP) reference number These key characteristic guidelines are available to the employees at their appropriate work stations. Key characteristics fall into two categories, Level I and Level II priorities. These levels are defined as follows: 2.0.2.1

LEVEL I (SERIOUS)

Immediate corrective action is required. The product fails t o meet customer or internal mill quality specifications. Material

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that is produced while a Level I characteristic is out of compliance is held for disposition. 2.0.2.2

L E V E L !i ( M A J O R )

Corrective action is required while the process is brought back into compliance and control. This out-of-compliance condition reduces the ability of the product to meet internal standards or customer requirements. Production, prior to the necessary corrective action, should receive additional testing, inspection, or quality assurance reviews to verify its acceptability or compliance to established standards or customer requirements. There is a third-priority level (Level II Minor), which is associated with characteristics that are monitored but are not considered key characteristics. This level is defined as follows: Corrective action may be deferred for a short period of time because of the weak influence that the noted characteristic has upon product quality. 2 . 0 . 3 S T A N D A R D O P E R A T I N G PRACTICES ( S O P S )

Plants maintain standard operating practices. These practices define the process and product standards and outline the methods for controlling key characteristics that are critical to the consistent operation of the machinery and the quality of the manufactured product. These practices also outline the equipment and instrumentation that must be operational in order to ensure a consistent operation and to control the key characteristics. Standard operating practices describe the manufacturing requirements needed (who, what, when, where, why, and how) to control key characteristics to ensure that the process operates properly and imparts the required attributes to the product. These practices may reference other procedures and practices.

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Compliance to and maintenance of these practices are the responsibility of the affected operating areas. The standard operating practices are available at the appropriate work stations. Standard operating practices are reviewed for content at least annually and audited routinely for compliance. Reviews and reasons for revision of standard operating practices are formally documented and retained by the plants. 2.0.4

S T A T I S T I C A L T E C H N I Q U E S AND A P P L I C A T I O N S

The TPPM program mandates education, training, and the implementation of statistical techniques for both the control and improvement of the process and resulting product quality. These techniques are required to statistically control selected key characteristics and evaluate the process and product capability. These selected capabilities are to be updated when known changed conditions occur. Quality assurance is responsible for coordinating and documenting these studies. These capabilities are used when planning quality goals and objectives. The plants are responsible for establishing procedures for identifying adequate statistical techniques required for verifying the acceptability of process capability and product characteristics. Statistical process control (SPC) guidelines will be written to identify how SPC is used to monitor the key process characteristics. An SPC control guideline will accompany all statistical process control charts, which are used to monitor key characteristics on a real-time basis. These guidelines highlight for the operator the characteristic to be controlled, the standard concerning the characteristic, the reason for controlling the characteristic, the method of control, and corrective action guidelines when an out-of-control condition occurs.

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SCHEDULING

The TPPM program requires documented scheduling practices that optimize process control and product quality. Employees from operating, process control, quality assurance, and business planning develop these practices. They are audited for compliance. 2.0.5.1

MAINTENANCE

The TPPM program requires a maintenance-for-Total-PlantPerformance-Management plan for plant facilities. Operating management, maintenance, engineering, and quality assurance are responsible for identifying equipment components. The plants establish the method of prioritization criticality of the equipment component. Predictive/preventive maintenance programs are also implemented to address those critical components, as required. Problem-solving teams and failure analyses are used to address selected maintenance problems. Compliance to this program is monitored and used as a tool for continued facility improvement. 2 . 0 . 6 EQUIPMENT CAPABILITIES

The TPPM program requires that engineering be responsible for reporting and verifying the designed capabilities of the key equipment. Operating management, maintenance, research, and engineering share responsibility for identifying equipment modification and/or new technology necessary to achieve the goal of continuous improvement. The resources to upgrade equipment capabilities are made available so that continuous improvement can be achieved. The TPPM program uses in-process standards that define the desired product characteristics at any phase of operation within the plant.

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I M P R O V E M E N T

Product is measured for conformance to these standards, and the information is used to promote continuous improvement. In-process quality requirements are to be clearly stated. Representatives of each function concerned with the product participate at each stage of development, review the in-process standard, and approve it. Unrealistic aims, tolerance limits, and incomplete, ambiguous, or conflicting manufacturing requirements are to be resolved. Recurring failures may indicate that corrective action to the process is required. This may require the use of the TPPM problem-solving approach (operating dynamics analysis) to address the condition and implement the necessary actions. 3.0

SPECIAL

PROCESSES

The plants are responsible for identifying special processes where they apply. These are processes whose results cannot be fully verified directly through inspection or testing of the product and where, for example, processing deficiencies may only be apparent after the product is in use. This would require continuous monitoring a n d / o r compliance with documented procedures to ensure that specified requirements are met. These procedures will be qualified, documented, and maintained. 3.0.1

MATERIAL

AND

PRODUCT

CONTROL

The TPPM program has established procedures that document the review process of customer contracts. These procedures ensure that customer specifications are completely defined and documented prior to order acceptance. Specifications are accurately communicated to the processing units so that the product is produced under controlled manufacturing conditions. These conditions include the use of documented procedures and practices that define the methods of manufacturing. Process control is the primary method used to provide the required quality to the next operation and the customer, but inspection, testing, and

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auditing techniques are employed to verify conformance to internal product standards and customer specifications. 3.0.2

SPECIFICATION C O N T R O L A N D PRODUCT P L A N N I N G

The TPPM program requires that customer orders correctly identify customer requirements. This is achieved through a mutual effort among sales, customer technical services, plant quality assurance, and business planning. Order acceptance is based on comparing customer contract requirements against the authorized product manual, available mill resources, and production capabilities. Any requirements differing from those in tender are resolved. Records of such contract reviews are documented and maintained. Customer requirements are entered into the order records, scheduling, and Metallurgical Index Code (MIC) system. Documentation and reporting requirements are incorporated where appropriate. A business-planning order-change control procedure is established to ensure that changes entered after order acceptance are incorporated into the production schedule. The order-change control system provides for documenting, verifying, and updating all required changes. The TPPM program specifies that product standards be maintained that quantitatively define quality and performance requirements of the product and recognize current mill capabilities. This is accomplished by use of product standards, which are integrated into the Metallurgical Index Code (MIC) system. These standards are developed through a TPPM team effort with concurrence from quality assurance, sales, plant representatives, and customer technical services. The MIC, with the appropriate product

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standard, is selected by plant quality assurance to meet the individual customer order requirements. 3.1

IN-PROCESS

PRODUCT

3 . 1 91 P L A N N I N G

OF IN-PROCESS

INSPECTION

AND TESTING

Inspection and testing are preplanned and conducted at key control points in the process to measure compliance to the T P P M program requirements. These key control points are developed and documented. 3.1.2

IN-PROCESS

INSPECTION

AND TESTING

Inspection and testing of the product is performed as identified in the key control points and as specified in the Metallurgical Index Code (MIC) system. Process monitoring and control methods are also used to ensure that the product conforms to specified requirements. The product is held until the required inspection and tests have been completed or the necessary reports have been received and verified. Product that is suspected to be nonconforming is identified and held until its acceptability can be verified or until its disposition is completed. 3.1.3

HANDLING

AND STORAGE

Documented procedures are used to control the handling of product to prevent damage or deterioration. Storage areas or stockrooms will have provisions to prevent damage or deterioration, pending use or delivery. Appropriate methods will be provided for authorizing receipt and the dis-

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patch to and from storage. The condition of the product in storage will be assessed at appropriate intervals. 3.2

FINAL 3.2.1

PRODUCT

CONTROL

F I N A L I N S P E C T I O N AND T E S T I N G

The TPPM program requires acceptance inspection and testing of the product prior to final release to ensure that it meets customer requirements and industry standards. The frequency of inspection and testing is consistent with the quality level and the capability of the process. Final inspection and/or testing may also include appearance, pack, mark, and load requirements, as well as simulation of the product's end use. No product will be shipped until all activities specified in the documented quality procedures have been satisfactorily completed and the associated data and documentation are available and verified to meet specified requirements. Reworked, repaired, or reapplied product shall be inspected and/or tested in accordance with established procedures. 3.2.2

IDENTIFICATION, H A N D L I N G , PACKAGING, S T O R A G E , AND SHIPPING

The TPPM program requires procedures for defining the quality of the product while it is in storage and transit and for ensuring conformance to specified requirements. These procedures include product identification, damage, corrosion, stocking, and destocking techniques. Included in these procedures are methods that: 9 Define packaging and preservation requirements that will identify, preserve, and segregate (when practical) the product, from the time of receipt until shipment.

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9 Evaluate, control, monitor, and audit the marking and labeling of materials and finished-product and transit requirements. 9

9

3.3

Arrange for protection of the quality of the product after final inspection and testing that shall include packaging, handling, and storage damage. Will provide a storage area with provisions to prevent damage or deterioration pending use or delivery. PURCHASED

PRODUCTS

AND SERVICES

The TPPM program specifies the quality and performance requirements of as-received, purchased materials and services. In the case of purchased products, such as slabs, or hot bands purchased from corporation plants, the specified requirements are negotiated between the two plants. The system provides for an integrated team effort among raw materials procurement, purchasing, quality assurance, and the plants to ensure effective supplier quality management. This system includes a supplier quality audit, product/service performance review, and rating system administered by the purchasing department and raw materials procurement. Suppliers to (company) are issued (company) "Guidelines for a Quality Process." These guidelines outline quality standards and program components required of suppliers that provide purchased products and services to (company). An information system for feedback between purchasing and suppliers for corrective action is in place. Procedures, which describe the certification and rating process, frequency of supplier certification, audits, and follow-up audits, are maintained by the purchasing department.

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I M P R O V E M E N T

When a third-party auditor is employed, the purchasing department is responsible for assuring the integrity and competence of the auditing agency. Supplier performance data and data regarding received key commodities at the plants are retained and evaluated. The purchasing department is responsible for requiring suppliers to provide evidence of statistical control of their processes and capabilities. Purchasing monitors how well the suppliers' processes or products show improvements in their variability over a period of time. Records of the suppliers' rating and status of acceptability are maintained. The purchasing department is responsible for ensuring that the quality of the purchased products and services meet the order requirements. In addition, when appropriate, it is responsible for periodic inspection and testing of the purchased materials at the supplier's plant or upon receipt in order to verify their acceptability. Verification by purchasing does not absolve the supplier of the responsibility to provide acceptable product. 3.3.1

PURCHASING

DATA

Purchasing documents contain data clearly describing the product ordered including, where applicable: The type, class, style, grade, or other precise identification. The title or other positive identification, and applicable issue of specifications, drawings, process requirements, inspection instructions, and other relevant technical data, including requirements for approval or qualification of product, procedures, process equipment, and personnel.

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3 . 3 . 2 P U R C H A S E R - S U P P L I E D PRODUCT

Procedures are provided in the event customer-owned product is used in the process. These procedures address verification, storage, and maintenance of customer-supplied product and will require the documentation and reporting of any such product that is lost, damaged, or otherwise unsuitable for use. Documentation of discrepant conditions and the reporting of such conditions to the customer are maintained. 3.4

CONTROL MATERIALS

OF NONCONFORMING AND

PRODUCTS

The TPPM program requires all plants to have procedures to identify, segregate (when practical), and control the disposition of materials and products that do not conform to specified requirements. These procedures apply to raw materials, inprocess products, finished products, consumables, and supplies. Plant management, quality assurance, and business planning are responsible for implementing these procedures. All nonconforming product is identified and held, and the reason for the hold is documented. All nonconforming product is prevented from being further processed until the product is evaluated and disposition is authorized. Disposition may be any of the following actions: 9

Rework to meet specified requirements

9 Acceptance with or without repair by concession 9 Regrading for alternative applications 9 Rejection or scrapping Where required by contract, the proposed use or repair of product that does not conform to specified requirements shall be reported for concession to the customer. The description of the

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nonconformity that has been accepted and the repairs will be recorded to denote the actual condition. Repaired and reworked product will be reinspected in accordance with documented procedures. Business planning administers the application of diverted, inprocess, and final product according to quality assurance guidelines. 3.5

PRODUCT

IDENTIFICATION

AND

TRACEABILITY

The TPPM program requires all plants to have procedures, as appropriate, for identifying the product from applicable drawings, specifications, or other documents during all stages of production. Product identification information is recorded, starting with the heat number, to maintain traceability of the product through all stages of production and delivery. 3.6

INSPECTION

AND

TEST

STATUS

The inspection and test status of product shall be identified by using markings, authorized stamps, tags, labels, routing cards, inspection records, test software, physical location, or other suitable means that indicate the conformance or nonconformance of product with regard to inspection and tests performed. The identification of inspection and test status shall be maintained, as necessary, throughout production and installation of the product to ensure that only product that has passed the required inspections and tests is dispatched, used, or installed. Records shall identify the inspection authority responsible for the release of conforming product.

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PRODUCT SYSTEM

I M P R O V E M E N T

CONFORMANCE-VERIFICATION

The TPPM program requires that management provide adequate resources and assign trained personnel for verification activities. Verification activities include inspection, testing, and monitoring of the design, production, installation, and servicing processes and/or products. Quality assurance maintains documented procedures for verification of product conformance. These procedures assure that the product meets or exceeds the internal quality requirements and the customer's specifications. Conformance of incoming material to specified supplier quality requirements is verified by procedures prior to use. The purchasing department requires that suppliers meet product-performance and program requirements. 3.7.1

RECEIVING

INSPECTION

AND TESTING

The plants are responsible for ensuring that incoming key commodities are not used until they have been inspected or otherwise verified as conforming to specified requirements. Verification is accomplished in accordance with documented procedures. Where incoming product is released for urgent production purposes, it will be positively identified and recorded in order to permit immediate recall and replacement in event of nonconformance to specified requirements. Each plant determines the amount and nature of receiving inspection performed. Consideration will be given to the control exercised at the source. This determination is documented in the plant procedures.

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I M P R O V E M E N T

I N S P E C T I O N AND TEST RECORDS

All testing and inspection is performed in accordance with documented (company), customer, or approved industry procedures. Results of product testing and inspections are documented in test records and indicate the successful meeting or exceeding of quality requirements. Test records are maintained. 3.8

PRODUCT SYSTEM 3.8.1

TESTING

AND MEASUREMENT

INSPECTION~ MEASURING~ AND TEST E Q U I P M E N T

The TPPM program requires that appropriate procedures are used to ensure the accuracy and reliability of the equipment utilized to measure raw material, in-process quality, and final product quality. Management is responsible for implementing provisions to control and maintain inspection, measuring, and test equipment and to ensure that only measuring devices that are in approved calibration status are used. Provisions also require that calibration records are maintained and that equipment accuracy and fitness for use are maintained. Periodic studies or tests of the measuring and test equipment, including test hardware and software where applicable, are performed to check their adequacy and ensure that the equipment is capable of the accuracy and precision necessary to verify acceptability of the product. Records of these equipment checks are documented and maintained. Operations, quality assurance, and systems control are responsible for identifying the measurements to be made and for using only measuring devices with sufficient accuracy and that are in approved calibration status for determining the acceptability of

272

C O N T I N U O U S

I M P R O V E M E N T

the product. They are also responsible for assessing and documenting the validity of previous inspection and test results when the measuring device is found to be out of calibration. Calibration of inspection, test, and measuring equipment against certified calibration sources traceable to the national recognized standards is performed at regular intervals and is documented in the form of calibration records. These calibrations are performed in accordance with documented procedures, which include details of equipment type, identification number, location, frequency of checks, check method, and the acceptance criteria. Measures are taken to prevent inadvertent adjustments to inspection and test equipment, including test hardware and software, that would invalidate the calibration. Data that verify that the measurement methods are functionally adequate are made available to customers when required. Adequate environmental conditions for the calibrations will be provided along with provisions for the careful handling and storage of the measuring and test equipment. Certified laboratory facilities are provided when appropriate. 3.9

AUDIT

SYSTEM

The TPPM program requires a documented, comprehensive audit program to monitor implementation and compliance to its procedures. This audit program provides management with current information concerning the conformance to the TPPM program. Personnel independent of those having direct responsibility for the work being performed carry out audits of the program. The audit details are formally planned and documented. The designated management representative has administrative responsibility for the audit program. An independent thirdparty organization may be used to perform internal audits.

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C O N T I N U O U S

I M P R O V E M E N T

In the case of supplier audits, both purchasing and raw materials procurement are responsible for maintaining confidentiality of the information and the distribution of this information on a need-to-know basis. The audit system's results are used as a basis to determine the degree of implementation of the program in individual units or facilities. Audits and follow-up actions are preplanned and scheduled on the basis of the status and importance of the activity and are carried out by trained personnel in accordance with documented procedures. The results of audits are documented and brought to the attention of the management responsible for the area being audited. The area management has the responsibility to take timely corrective action for the deficiencies found by the audit. Verification of action taken is documented. 3.1 0 PROCESS/PRODUCT

CAPABILITY

Data obtained by operating and quality assurance are used to determine variability of the process and capability to meet process/product specifications. In concert with operating, quality assurance specifies the statistical techniques to be used in securing the data. 3.1 1 INFORMATION

MANAGEMENT

The TPPM program establishes a reporting mechanism to review annually the entire program to ensure its continuing suitability and effectiveness. These reviews will consist of the following: 9

Findings of internal audits centered on various elements of the quality system

9 The overall effectiveness of the TPPM program in achieving stated quality objectives

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I M P R O V E M E N T

9 Considerations for updating the TPPM program in relation to changes brought about by customer requirements, new technologies, quality concepts, market strategies, and social or environmental conditions 3.1 2 INTERNAL

FEEDBACK

Findings, conclusions, and recommendations reached as a result of this review are submitted in documentary form for necessary action by management. This information is also shared with all employee levels in a prescribed manner to assure that appropriate personnel are aware of current performance. 3.1 3 CUSTOMER

FEEDBACK

TPPM requires that the commercial organization, the customer technical service organization, and operations management maintain a system that promotes effective communication, addresses problems, provides technical guidance, and fosters a parmership with the customer. The implemented system supplies quantitative information regarding product quality, performance, delivery, and service. 3.1 4 SUPPLIER

FEEDBACK

The system provides reports based on information from supplier quality audits, product/service reviews, and the rating system administered by the purchasing department and raw materials procurement. The action system for continuous improvement analyzes feedback from the various TPPM program components including processes, work operations, reports, audits, customer feedback, and quality records to detect and eliminate potential causes of nonconformance.

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C O N T I N U O U S

I M P R O V E M E N T

This information is used to define significant customer, process, or product problems. This information is also used to investigate the cause of the problem(s) and the action needed to prevent recurrence. An improvement evaluation is conducted, and necessary preventive action is initiated to address problems in terms of potential impact upon customer satisfaction, quality, performance, reliability, safety, costs, and production. Responsibility for analysis and execution of the documented action rests with the appropriate division or department and is defined in the plant's quality manual. The quality improvement action sequence is established and mainrained in documented procedures and follows these guidelines" ,, The problem is defined and, when appropriate, the documented request for action is initiated. 9 An action team/person is assigned and is responsible for the documented analysis of the problem. Problem-solving and statistical techniques, as necessary, are used to identify the root-cause. 9 The assigned team/person is to propose, test, and verify possible solutions to the problem and review recommendations with impacted departments. The impacted department makes the necessary process and procedural changes and reinstructs appropriate personnel to assure the permanence of the quality improvement action. 9 Compliance to the changes is verified through targeted audits. 9 A documented report is prepared by the assigned team/person and summarizes the activities involved in resolving the problem and the implemented improvements.

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C O N T I N U O U S 3.15

I M P R O V E M E N T

DOCUMENTATION

The TPPM program has provisions and procedures for controlling specified documentation and data. Controlled documents, and any changes made to the documents, are reviewed and approved prior to issue by designated functions. Changes to documents will be reviewed and approved by the same function that performed the original review, unless designated otherwise. The designated reviewer must have access to pertinent background information upon which to base his or her review and approval. TPPM program documentation includes all manuals, procedures, and instructions necessary to assure implementation and conformance of the TPPM program. This includes plant qualitycontrol procedures, and standard operating practices pertaining to planning, training, auditing, specifying, inspection, testing, and operating. A master list or equivalent document-control procedure will be established to identify the current revision of documents in order to preclude the use of nonapplicable documents. Pertinent issues of current documents shall be available at all locations where operations essential to the effective functioning of the program are performed. Written procedures govern the identification, maintenance, and use of the current revision of controlled documents. Policies and procedures also define the availability at the plant level of this documentation and the prompt removal from use of out-of-revision, controlled documents.

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I M P R O V E M E N T

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.1 5.1

RECORDS

The T P P M program requires documented record-keeping procedures including: identification, collection, cataloging, storage, maintenance, retention and retrieval. Policies and procedures also define the availability of these records. Records and documents are maintained to demonstrate achievement of required product quality and include, but are not limited to: 9 Program documents 9 Contract review * Subcontractor quality records 9 Product identification to allow traceability 9 Inspection and test records * Quality cost reports 9 Design verification 9 Management review and audit records 9 Personnel training and qualification records . Statistical records and analyses 9 Calibration records and test hardware or software checks * Order, production, and shipping records 9 Records of disposition of nonconforming product . Records identifying the authority responsible for the release of conforming product Quality records shall be stored and maintained in such a way that they are readily retrievable in facilities that provide a suitable environment to minimize deterioration or damage and to prevent loss.

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I M P R O V E M E N T

Quality records will be legible and identifiable to the product involved. When agreed contractually, the purchaser or the purchaser's representative shall make quality records available for evaluation or review for a mutually agreed-upon period of time.

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Index A

C

American industry bureaucracy, 65 business environment, 19, 20 challenges facing, 19 competitive edge, 1, 19 early success, 12 loss of leadership, 42 philosophy, 53 reduced role, 1 trade policy, 3 unique breed, 44 work ethic, 12 Autonomous maintenance, 59 Availability, rate of, 77

Capacity design, 174 installed, 174 limited, 10, 11 rate of, 77 utilization, 174 Citizenship, economic, 14 Commitment definition, 22 fundamental requirement, 22 Competition, unfair offshore, 2, 4, 65 Continuous improvement create implementation plan, 164, 166 directed at limiting factors, 45 ensure return-on-investment, 164, 166 forget prejudices, 163 get absolute buy-in, 166 goals and objectives, 160, 181 holistic approach, 49 implementing, 33, 168 in America, 18 know your audience, 162

B

Benchmarking equipment reliability, 113, 114 plant stares, 27 reliability analysis, 115 Brake horsepower, 127 Bureaucracy, elimination, 66, 67 smothers innovation, 65

281

282

Total Plant Performance Management

program limitations, 39 selling programs, 160 take holistic view, 165 too many programs, 39 tracking and evaluation, 167 use of consultants, 40 Cooperation, organizational hierarchies, 14 Cost-benefit analysis, definition of, 180 Cost of quality, definition of, 177 Costs decommissioning, 81 installation, 80 life cycle, 25, 51 maintenance, 4, 7, 81 operating, 80 overtime premium, 7 procurement, 79 training, 80 Culture American, 44 change, 22 corporate, 67, 172 Japanese, 16 plant, 41

E

Economy, world, 14 Education system, 12 Effectiveness organization, 86 overall equipment, 77 production, 14 Employees corporate commitment to, 109 empowerment of, 105 involvement of, 33, 50, 104, 108 senior management's role, 109 Equipment reliability, 10, 12, 24, 51 utilization, 10, 51,175 European common market, 4

Failures analysis of, 153 analysis teams, 236 avoiding, 38 Functions, integration of plant, 27 Future, provide for, 14

D

G Discipline definition of, 23 enforced, 48 fundamental requirement, 22 planned, 10, 11 repair outages, 10 self-discipline, 46 Downsizing, 30 Duty task analysis, 143

Government intervention, 4 restraints, 2 H

Hydraulic curve, 126

Index I

Individualism, adversarial relationships and, 14 Industry snack food, 10 steel, 10, 55 Information management, 30 system requirements, 30 Installation foundation, 129 piping support, 129 Intervention, government, 4 Investment, capital, 4

rates, 4 unions, 4 Laissez-faire policy, 3 Leadership, definition of, 69 Life cycle costs, definition of, 25, 51, 78 Limiting factors analysis, definition of, 179 Losses business plan, 176 maintenance, 179 manpower distribution, 179 operating, 175 planning and scheduling, 176 production, 179 M

Japanese business leaders, 2 competition, 4 corporate philosophy, 16 culture, 15, 16 exports, 3 management methods, 15, 16, 17 market penetration, 4 mercurial rise, 3 superior products, 2 workers, 16 L Labor agreements, 7 cost, 4 domestic, 2

Machine design and selection, 82 dynamics of, 151, 154 training, 151 Maintenance autonomous, 59 costs, 4, 5,194 effectiveness, 4, 7, 197 evaluation of, 197 improvement, 4, 187 integration of, 29 labor, 5 manpower, 7, 199 methods, 188 planning and scheduling, 198 practices, 24, 200 role of, 195 Management practices American, 53 by exception, 70

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Total Plant Performance Management

Japanese, 15, 16, 17 offshore, 45 role of, 54 Manpower distribution of, 178 requirements, 180 Massachusetts Institute of Technology (MIT) analysis, 13 Mean-time- between- failures (MTBF), 190, 205,239 Mean-time-to-failure (MTTF), 190, 192 Mean-time-to-repair (MTTR), 204,240 O Offshore competitors, 2, 19 Operating dynamics analysis definition of, 112 benchmarking reliability, 113, 114 interpreting data, 134 training, 153, 155 use of, 215 Operating costs, 187 parameters, 114 Organization effective, 86 functional responsibility, 88 TPPM structure, 88, 182 typical structure, 98 P

Performance evaluation, 169 factors that determine, 121

optimum, 63 plant, 21,173 tracking, 184 Planners corporate, 11 maintenance, 200 Planning developing a detailed plan, 38 function of, 32 fundamental requirement, 53 Plant engineering integration of, 27 role of, 25, 56 Practices impact of operating, 119 operating, 115, 119 standard, 30 Predictive maintenance developing a program, 233 limitations of, 112, 116 organization structure, 231 role of, 97, 191,203 selecting best system, 218 technologies, 7, 113 training, 151,222,241 Preventive maintenance tasks, 7 training, 155 unnecessary tasks, 7 Procedures maintenance, 200 operator training, 155 standard, 30 Process variables, influence of, 118 Production costs, 187 critical systems, 113 effective, 14 integration of, 27, 28 role of, 25, 58

Index Profits real profit, 67 short term, 53 shrinking, 43 Purchasing integration of, 27, 29 role of, 25, 57

Small-group activities, effective use of, 51, 106 Suction conditions entrained air or gas, 125 net positive suction head (NPSH), 124 volume, 125

Q

T

Quality product, 10 rate of, 77 R

Reliability engineering, 24 equipment, 10, 26, 29, 51 Resource equipment utilization, 31 labor utilization, 31 Return-on-investment improvement costs, 52 lack of, 20 long term, 185 short term, 185 Revenue, annual, 10 Root-cause failure analysis, 43, 150, 153 Run-to-failure, 188 S

Sales and marketing integration of, 28 role of, 25, 55 Skills training program, 32

Thermography, 114, 152,215 Total Plant Performance Management (TPPM) benefits of, 71 definition of, 45 equipment reliability, 51 equipment utilization, 51 holistic approach, 49 implementing, 168 program development, 169 teamwork, 50 training, 58 Total productive maintenance (TPM), 2, 18 Total system head (TSH) total dynamic head (TDH), 126 Trade agreements, 3 Training basic knowledge, 139 classroom, 147 limitation of, 120 practical application of, 148 predictive maintenance, 222,241 programs, 142 requirements for, 140, 146, 149 role of, 58, 18a verification of, 148 Tribology, 114, 152,216

285

286

Total Plant Performance Management

V

W

Vibration acquiring data, 134 analysis, 207 frequency-domain, 114 implementing, 213 monitoring programs, 118, 152 normalization, 135 role of, 211 time-domain, 114 Voluntary Restraint Agreements (VRAs), 4

Work force distribution, 32 skilled and motivated, 32 Workers American, 9, 44, 50, 104 education of, 13, 104 laziness of, 7, 104 World economy, 14