Operations + Maintenance = Production

In this column, I will elaborate concerning the vital relationship between operations, maintenance and engineering. I will focus on the relationship between operations and maintenance. I have written about this before, but the question comes up very frequently, so it is worth repeating some of the information.

From my experience, it is more common than not to find that the working relationship between operations and maintenance is one of adversity instead of a relationship of close and productive cooperation. Operations often sees itself as the customer of maintenance and, consequently, maintenance is viewed as a service provider.

In such a relationship, it should be obvious that operations is responsible for the cost of the maintenance work it requests and gets delivered. However, in a bad relationship, this is not the case. As long as maintenance work requests are performed, operations views maintenance as the good guys. But, if at the end of the year it shows that the maintenance budget is exceeded, it is not unusual to find the maintenance manager in the hot seat having to explain why more money than budgeted was spent.

In a customer/service-supplier relationship, it is also common to find that priorities are very emotional. The customer wants something done and the service supplier says “yes, sir” and does its best to deliver. This is often done even if the service supplier knows that there is more important work to do instead of the work it was requested to do. I could go on with many other issues that result from this type of relationship, including lack of trust, poor communication and finger pointing when problems occur. However, I will instead focus on what you should do to improve this relationship.

Agree on the same goal
Ask yourself what the business of maintenance is and what the business of operations is. We could have a lengthy discussion around this, but common sense dictates one conclusion: If you are a manufacturer, your common goal must be that both departments are equal partners in manufacturing your product in the most cost-effective manner. This soon comes down to the following formula:

Time Efficiency x Quality Performance x Speed Performance, which is often called overall equipment efficiency (OEE)

However, I suggest you change the name to overall production efficiency (OPE). Why? Because you need to express clearly that both departments do have one and the same goal. You will no longer talk about lost production by departments in a finger-pointing manner. Instead, your focus should be root cause problem elimination. This is an important change, since it is not enough to just say, “OK, from now on we are partners instead of customer/suppliers.” Next, you make friends and do some teamwork training, etc.

You must also change the way your processes work. To change from OEE to OPE means that you also must abandon the practice of categorizing lost production by department – for example, by mechanical, electrical, instrumentation and operations. If you still do your production reports this way (which 95 percent of the industry, in fact, does), you break a ground rule when you try to get people to work together by asking “who?” instead of “why?”

I suggest you instead implement the following process:

• Collect problems that have caused high costs in safety, environmental, lost production (quality, time, speed), or problems causing high maintenance costs.
• Select which problem(s) to solve.
• Assign a problem owner to the selected problem.
• The problem owner selects a team to help solve the problem.
• Solve the problem.
• Document the solution.
• Educate the rest of the organization in the solution.

If you truly did more of the above, instead of wasting energy and time on guessing which department is to blame, you would have started autonomous education and training. You will also remove one of the barriers that keep you from working better together. Soon, you will also see that problems are not always classifiable by department because the root cause to the problem is often a mix of how you operate the equipment and/or the process and how you maintain it.

Establish the right focus
If you agree with that the relationship between operations and maintenance should be a partnership, not a customer/supplier relationship, the next step in promoting this partnership is to establish the right focus in your joint improvement effort.

So, if maintenance is not a service provider, what does maintenance deliver? I think that both maintenance and operations deliver reliability. The maintenance department delivers equipment reliability and the operations department delivers process reliability.

Reliability can be defined as “Quality production output at expected speed without downtime, personal injuries or environmental damages,” or the same as overall production efficiency. It can be measured as OPE or with the following formula: MTBPL/MPL, where:

MTBPL = mean time between production loss
MPL = mean production loss

The term “production loss” is suggested rather than the more common reliability term MTBF (mean time between failure). The reason for this is that you should stress the fact that you want to avoid operational problems, as well as equipment problems. The term “failure” is too often related to technical equipment failures (maintenance).

If you have decided to focus your improvement efforts on reliability improvements that will result in sustainable, lower maintenance costs, I advise you to find out the revenue of increased reliability as it compares to the value of reducing maintenance costs. A common way of doing this is to estimate the average market price for a product or a product mix over the last five years. Then, deduct the variable cost to make the product over the same time period. For example, a pulp mill received an average market price of $700 per ton for its product mix. The variable cost to make a ton was $340. The financial contribution the mill will receive for each ton made and sold is consequently $360 per ton.

As shown in the graph, your joint goal is to continuously increase MTBPL and decrease MPL. The combined results of this will be a reliability factor of, for example, 50.4. Your joint operations/maintenance goal is to continuously increase this factor.

The next thing you need to do is to identify the bottleneck of the process line making the product and the OPE of this process. If the bottleneck is the bleach plant and the OPE there is 84 percent, the potential opportunity to increase OPE is most probably in the area of 6 to 10 percent. Assuming that the pulp dryer machines and baling lines can handle the increase in production and your present throughput is 500,000 tons per year, the value of a 5 percent increase in production throughput is worth 25,000 tons x $360 = $9 million per year. The maintenance cost for this pulp mill is $87 per ton or a total of $43.5 million per year. A 5 percent reduction in maintenance costs would be worth $2.175 million/year, or 24 percent of the value of increased and sold production.

In this example, it should be obvious that your joint operations/maintenance focus should be reliability. A lower maintenance cost will then follow as your reliability increases. The problem is that your boss might ask you to do both at the same time or, even worse, ask you to first cut the maintenance cost and then focus on reliability. My experience has shown over and over again that this approach will fail.

A joint venture
One thing is to agree to that operations and maintenance are equal partners in a joint venture resulting in reliable production. Another thing is to make it happen and, to make it happen, you need to do things differently than you have done in a customer-supplier relationship. For example, you should:

• Agree on the same goal: overall production efficiency (OPE).
• Achieve the right joint focus: total reliability. There is revenue as a result of improved reliability. Improved reliability results in lower sustainable maintenance costs.
• Solve problems: Do not classify production losses by department.

Other things you can do to promote the partnership are:

• Include operators in basic inspections and essential care of equipment
• Agree on guidelines for priorities of work requests
• Communicate production plans
• Create a joint shutdown schedule

Of course, the most important part of building the partnership is personal relationships. However, organizations are changing and, with the wrong processes in place to promote a partnership, things will fall back to a less effective work system.

Include operators
Where it is practical and makes sense, operators should undertake some basic inspections of equipment. If it is practical for an operator to do inspections, they should be taught to do so. As a guideline, if an operator can be trained in an inspection method in less than 15 minutes, he or she should be trained to do that inspection.

A classic example is the inspection of a rotary steam joint for a paper machine. It makes sense for a back tender to not only look at ropes, felts, paper web, doctor blades, condensate returning through steam joint, etc., on the back side of a paper machine, but to also inspect the condition of the carbon ring in the steam joint. Training operators on how to do this takes less than five minutes.

Agree on work request priorities
First of all, maintenance work should start with a work request, not a work order. A work request might or might not turn into a work order.

If a work request turns into a work order, the execution should follow jointly agreed upon priorities. It is a very good idea to develop these together between operations and maintenance.

To sit down with your operations partner and agree on these guidelines and then start using them jointly is one of the most hands-on and best ways of making the partnership happen. I will be glad to send anybody who requests it an example of a priority guideline.

Promoting partnerships
To make a partnership between maintenance and operations successful, you need to do things differently than you have done in a customer-supplier relationship.

Here are things you can do to promote the partnership.

1. Communicate production plans: It might seem obvious that communicating production plans is done no less often than in your weekly Thursday meeting between the operations and maintenance partners. However, my experience is that it is not a given that maintenance and operations communicate the production plan well enough.
   
   As a minimum requirement, the production plan is posted weekly and updated daily. This allows scheduling of maintenance work to best take advantage of all opportunities that present themselves. This is important for a process producing many different sheet characteristics, such as a paperboard machine making everything from uncoated to coated on one or both sides, running one or more wires. It is also important in other processes. For example, if you make one type of pulp in a continuous digester, you will have fewer maintenance opportunities on short notice.

2. Identify maintenance opportunities: Sit down with your operations partner and identify all maintenance opportunities that present themselves as you go through each product you manufacture. Also, estimate a time range available for maintenance work. Give each maintenance opportunity a code and describe them on the backside of the priority guideline.
   
   In your work requests, the requestors should fill out the maintenance opportunity as a minimum requirement per your standard for "work requests." The value of doing this is that you will learn more about the manufacturing process while at the same time promoting the partnership and opening up more opportunities to do maintenance without losing production. You will start taking advantage of all scheduled and unscheduled shutdowns to do necessary maintenance work.

3. Joint shutdown schedule: It is not uncommon to find that there are four to five shutdown schedules, and these schedules are not well-connected to each other. There might be one schedule for operations work, another for mechanical work, etc. An indication of a good partnership between operations and maintenance – and also within maintenance – is that there is only one schedule for every shutdown. This schedule should be well-connected between all involved departments.

4. Operating practices and maintenance prevention: Include operating practices in your maintenance prevention program. When you do the priority guideline jointly with operations, you will most probably discuss one event called "critical process running on spare equipment." This is when, for example, you run a spare pump because the redundant pump is not performing. This event often triggers a long discussion. Operations has always called maintenance resources to repair the failed pump, even if it is 2 o'clock in the morning.

The solution is that switching pumps between shutdowns becomes the responsibility of operations. All doubled pumps are marked "A" and "B," so it is easy to remember which pumps to run. (It is not unusual to find that both pumps are unknowingly running and working against each other). There are many other operating procedures you should include in your maintenance prevention program. Examples include how to heat up a steam system, how to start a pump correctly and how to clean without causing problems.

Vision and mission statements
As most of you know, vision and mission statements do not always exist and, if they do exist, they are seldom well-communicated or understood. Not long ago, I sat in a meeting to discuss these statements with a group of operations and maintenance managers from a large international company, along with their vice president of manufacturing. After presenting the many different statements used in different plants, it all became very confusing. "Do we all understand the difference between vision and mission?" a frustrated manager asked. It showed that most people in the meeting could not clearly define the difference, yet they all had documented statements.

To make a long story short, it was decided that a vision statement should explain what the organization would like to become or where the organization would like to be in the future. On the other hand, a mission statement should explain the purpose of the organization¹s existence. It was also determined that these statements would be decided on a corporate level as a decree. How each organization accomplished the mission was left up to that organization.

A long discussion followed on the different roles of production and maintenance and, at the end, it was determined that production is a partnership, not an internal customer relationship. This must be reflected in the vision and mission statements. Nomenclature, therefore, needed changing so that production became the common denominator for operations and maintenance.

If you read this column to this point, and agreed to the approach, the following should be easy to agree on:

1. The result of maintenance work is equipment reliability (and preservation/prolonging life of assets).
2. The result of operations work is process reliability.
3. Together, the result is production reliability.

Consequently, in our meeting, the mission statement for maintenance was agreed to read as, "To deliver cost-effective equipment reliability," and, for operations, "To deliver cost-effective process reliability." The term cost-effective means that the cost to accomplish a result must be less than the value the result is expected to deliver in comparison with other investment alternatives. The joint mission statement was decided upon as, "Operations and maintenance shall together deliver cost-effective production reliability."

Current best practices document
The vision statement for maintenance is built on what we call current best practices (CBP). Each key process in reliability and maintenance is identified and documented – for example: leadership and organization; planning and scheduling; preventive maintenance; technical database; stores management; root cause problem elimination; and so forth. Each of these key processes is broken down into sub-processes. For example, within the key process of planning and scheduling is the sub-process of work request. This sub-process contains elements such as scope of work defined, equipment number defined, and so forth.

The CBP document forms the basis for evaluating the gap between how good an organization is and how good it could be. Based on the agreed upon CBP document, the following vision statement was adopted during our meeting:

Achieve an average of 80 for all CBP elements by the year 2005

I can assure you that this is an aggressive vision; I have never done an audit that has resulted in higher than 55 on this 100-point scale. Achieving the vision will result in increased reliability and, consequently, lower maintenance costs, but it can only be accomplished in a partnership with operations and engineering.