1 © Life Cycle Engineering 2011 Business Excellence powered by Rx R. Keith Mobley Principal, SME...
-
Upload
ellis-wheelock -
Category
Documents
-
view
220 -
download
3
Transcript of 1 © Life Cycle Engineering 2011 Business Excellence powered by Rx R. Keith Mobley Principal, SME...
1© Life Cycle Engineering 2011© Life Cycle Engineering 2011
Business Excellence powered by RxR. Keith MobleyPrincipal, SMELife Cycle Engineering, Inc.
3© Life Cycle Engineering 2011
Reliability Myths
• Reliability only applies to physical assets• Reliability is a maintenance-only problem• Asset reliability is dominate reason for poor
business performance• Asset reliability is dominate reason for low asset
utilization• Excessive maintenance cost limits competitive
ability
4© Life Cycle Engineering 2011
Asset Reliability Losses
Source: The Plant Performance Group 1985 - 2010
5© Life Cycle Engineering 2011
Asset Utilization
Source: The Plant Performance Group 1985 - 2010
Maintenance 7%
6© Life Cycle Engineering 2011
Reliability
• The probability that a business process, work procedure, capital asset and employee will – without exception – perform its required function in both normal an abnormal day-to-day operations
• It is a holistic issue and must be resolved with a holistic solution
7© Life Cycle Engineering 2011
World-Class Business
Marketing drives backlog and determines current and future production requirements
Production must respond to market demands and effectively use installed capacity
Maintenance must respond to both market demands and production needs, as well as provide sustaining maintenance that prolongs asset useful life
Excellence in and Integration of::
Production Asset Care
Marketing
8© Life Cycle Engineering 2011
The Focus of Reliability Excellence
Production
ReliabilityMaintenance
EH&S
Supply Chain
• Standard procedures• Waste and loss elimination• Quick changeovers• Stable, consistent processes
• Risk management• Asset management
• Loss, waste elimination• Performance
management
• Asset care• Useful life management
• Supply chain management• MRO materials management• Materials handling and JIT• Inventory management
Procurement
• Occupational Health & Safety
• Environmental Compliance
9© Life Cycle Engineering 2011
Reliable Processes
Visionary Leadership
Marketing & SalesSupply Chain
Logistics & Distribution
Operational Reliability
Human Resources
BusinessStrategy
Asset Management
Voice of Customer Quality
EH&SCapital Assets
Financial Risk Management
10© Life Cycle Engineering 2011
EFQM ModelLe
ader
ship
Pro
cess
es
Key
Per
form
ance
R
esul
ts
People
Policies & Strategy
Partnerships & Resources
People Results
Customer Results
SocietyResults
Innovation & Learning
Enablers Results
(European Foundation for Quality Management)
Business Excellence Models Stress:
• Leadership• Standard Processes• KPI
Models Assume:
• Asset Reliability• Universal Best Practices• Engaged Workforce• Enabling Work Culture
11© Life Cycle Engineering 2011
Reliability Excellence Model
MATERIALS MANAGEMENT
ASSET CARE
WORKSCHEDULING
WORK MANAGEMENT
PROCESSES
FACILITIES & EQUIPMENT
WORK MEASUREMENT
WORK PLANNING
WORKFORCE DEVELOPMENT
ORGANIZATIONAL STRUCTURE
SUPERVISIONINFORMATION MANAGEMENT
OPTIMIZATION
MANAGEMENT REPORTING
BUDGETING & COST CONTROL
MANAGEMENT OF CHANGE
EQUIPMENT HISTORY
AUDITS & ASSESSMENTS
RELIABILITY ENGINEERING
SUSTAINABILITY
OPERATOR CARE
PROCUREMENT
EQUIPMENT & PROCESS DESIGN
FUNCTIONAL PARTNERSHIPSMANAGEMENT COMMITMENT
PRINCIPLES
ORGANIZATIONAL BEHAVIOR
EMPLOYEE INVOLVEMENT
GOALS & OBJECTIVES
GOVERNING PRINCIPLES
OCCUPATIONAL HEALTH & SAFETY
CULTURE
PERFORMANCE MANAGEMENT
LOSS ELIMINATION
12© Life Cycle Engineering 2011
Aluminum WheelsProblem Statement• Average Production: 5,600 wheels per day• Profit: -$2.31 per wheel • Downtime: 1% (unscheduled)
Perception• Obsolete foundry technology• Asset reliability
Reality• Failure to adhere to standard procedures
Results• Average Production: 12,000 wheels per day• Profit: $40.63 per wheel• Downtime: 1% (unscheduled)
13© Life Cycle Engineering 2011
Standard Work Is Essential To Excellence
Mission
Policies
Standard Processes
Standard Procedures
Actual Practices
Actual practices define effectiveness and are created by standards and change management.
Why would standard work be met with resistance?
14© Life Cycle Engineering 2011
The Path To Standard Work In Production
Standard Work is Central to the Continuous Improvement Process
Standard Work
Standard WIP
• Available time • Customer demand
• Time Observation Form• Total work content
• Load Chart• Balance work• Enable flow• Required resources
• SW Combination Sheet• Content• Sequence• Timing• Outcome• Safety
Line BalanceWork Content & SequenceTakt Time
• Location• Amount• Enable Flow
15© Life Cycle Engineering 2011
Standard Work Should be Layered and Developed from the Bottom Up
ExecutivesTime on the floor to verify the chain of standard work is upheld and production process is stable
and improving
Value Stream ManagersMonitor and support supervisors in their ability to
carry out their standard work
SupervisorsMonitor and support team leaders in their ability to
carry out their standard work
Natural Work Team Leaders
Maintain production andensure standard work is followed
Layers of Standard
Work
16© Life Cycle Engineering 2011
Who Should Have Standard Work?
Role% of Work (time) that should be Standard
Executives 10-15%
Value Stream Manager 25%
Support Department Managers
50%
Supervisors 50%
Team Leaders 80%
Operators (Associates) 95+%
Maintenance Technicians 85% - 90%
17© Life Cycle Engineering 2011
Alumina Refinery
Problem Statement• Excessive failures of 700 Surry pumps (MTBF: 6 months)• Maintenance cost $12M per year
Perception• Poor maintenance practices
Reality• Mode of operation (control range)
Results• Failures virtually eliminated (MTBF: 36 months)• Maintenance cost less than $100K per year• Energy use reduced by $11.3M per year• Improved process performance
18© Life Cycle Engineering 2011
Conduct Problem-solving
EFFECT
MAN
MATERIALS METHODS
MACHINES
Pareto Losses
Business Case Target Condition
Current Condition Action Plan
Metrics
Action Plan
Perfection
Seek
Target
Gap
Identify Losses
Standard Loss Elimination Process
19© Life Cycle Engineering 2011
High-speed Manufacturing
Problem Statement• Loss production, missed deliveries• High production costs
Perception• Maintenance deficiencies• Operators not performing
Reality• Management decisions limited utilization to 50%
Results• Restructured operating plan• Eliminated losses within OEE
20© Life Cycle Engineering 2011
Asset Utilization Losses
Installed Capacity = 58,867,200,000
5-Day Work Week = 16,128,000,000
3,225,600,000Two 5-Day Outages =
2,520,000,00030 Minute Cleaning/Shift =
29,615,040,000Total AU Losses =
Available Capacity = 29,252,160,000
50%
PM (9 Shifts) x 2 = 7,741,440,000
21© Life Cycle Engineering 2011
Operating Losses
Possible Capacity = 29,252,160,000
Uptime (Actual) (80%) = 5,850,432,000
14,626,080,000Production Rate (50%) =
475,292,160Quality Rate (98%) =
20,951,804,160Total OEE Losses =
Net Output = 8,300,355,840
OEE Losses
14%
22© Life Cycle Engineering 2011
7 or 8 Wastes of Lean
1. Defects
2. Overproduction
3. Transportation
4. Waiting
5. Inventory
6. Motion
7. Processing
8. Skills – Not utilizing people’s talents
23© Life Cycle Engineering 2011
High-speed Manufacturing
Problem Statement• Chronic failure to meet production goals• Losses in excess of 22 billion units per year
Perception• Reliability of the production modules
Reality• Modules starved for WIP materials
Results• Throughput increased by 20 billion plus units per year• Production cost per unit reduced by $0.0105• Production (operating) hours per year reduced by 120
days
24© Life Cycle Engineering 2011
A Representative Current State Map for a Family of Retainers at a
Bearings Manufacturing Company
ABC Steel Co.
ABC Enterprises
C/T = 3 seconds
C/O = 2 hours
Uptime = 75%
21,600 secs. avail.
1 shift
C/T = 22 seconds
C/O = 30 minutes
Uptime = 100%
25,200 secs. avail.
1 shift
C/T = 35 seconds
C/O = 45 minutes
Uptime = 75%
25,200 secs. avail.
1 shift
Workbook pg. 67
25© Life Cycle Engineering 2011
Refinery
Problem Statement• Excessive maintenance cost for repair of heat exchangers• Low thermal efficiency in the slurry process
Perception• None—performance accepted as norm
Reality• Contracted maintenance services unacceptable
Results• Cleaning rather than replacing tubes• Thermal efficiency improvement of 55%• Reduced maintenance cost by $6.3M per year
26© Life Cycle Engineering 2011
Asset Management
Organizational Strategic Plan
Other Organizational Requirements and Systems
Legal and Stakeholder Requirements and Expectations (Customers, Shareholders, Employees, Vendors, Society
Asset Management Policy• Asset Management Strategy• Asset Management Objectives• Asset Management Plans
Portfolio of Asset Systems and Asset (Diversity of Types, Criticalities, Condition and
Performance
Performance and Condition
Monitoring
Acquire, Create, Utilize
Maintain, Review and
Dispose
Organizational Values,
Functional Standards, Required
Processes
Asset Management Enablers and Controls
Continuous Improvement
27© Life Cycle Engineering 2011
Food (Bakery Products)Problem Statement• 50% Scrap rate on baked cookie line• Missed deliveries and loss of market share• Constant jams and miss-feeds
Perception• Poor maintenance practices
Reality• Low bid system (inherent design deficiencies)• Poor changeover procedures
Results• Scrap rate 3% • On-time delivery
28© Life Cycle Engineering 2011
Asset Management Encompasses
Operations Activities(Operator
Care)
Maintenance Activities
29© Life Cycle Engineering 2011
Key Process Categories
Principles and Culture Processes Optimization Sustainment
ThemesBuild Alignment and
PartnershipsDefinition and Discipline Key Business Processes
Proactive Management and Planning
Enhancing Systems and Processes
Levels Key Process Areas (KPA)
World Class
Excellence
Proactive
Emerging
Reactive1
2
3
4
5
No vision of the future Highly siloed organization Adversarial functional relationships Coordination poor or non-existent Motivation and morale low Absenteeism and turnover high
No goals and objectives Ad hoc processes and procedures High variability in work execution Workforce skills lacking Ineffective performance measures Errors and failures are norm
No leadership Autocratic management Budget compliance management Limited or ad hoc planning No continuous improvement effort Reacting to events is the norm
None
Initial vision statement exists Communication plan between silos Early signs of coordination Motivation and morale variable Absenteeism and turnover high
Initial Strategic business plan exists Cascading goals and objectives Moderate to high variability in work Skills training program evolving Minimal performance measures
Senior leadership missing Traditional hierarchical management Planning is minimal and isolated Limited efforts at problem-solving Reactive events decreasing
Focus shifting from survive the day Need for change acknowledged Leadership becoming involved Some employee involvement
Workers accept Vision statement Partnership agreements established Moderate inter-function coordination Motivation and morale improving Absenteeism and turnover moderate
Effective strategic plan used well Cascading KPIs established & used Work variability decreasing Workforce skills improving Effective performance measures
Executive sponsor committed to Rx Management team resistance First attempts using natural teams Growing mutual trust at all levels Reactive events becoming exception
Focus shifting from now to future Leadership committed to change Workforce involved in change First signs of workforce ownership
Vision statement provides focus Seamless functional coordination Full employee involved in operations Motivation and morale high Absenteeism and turnover minimum Open, honest communication
Standard processes & procedures Non-value activities eliminated Loss and waste minimized Variability tightly controlled Performance trends at or near goals Workforce skills enable success
Executive team leads plant team Management team committed to Rx Increasing use of work teams Mutual trust firmly established Reactive events are rare
Performance management in place Leadership empower workforce Workforce embraces change
Strong, active leadership Clear, concise vision and mission Universally shared values Effective, cascading goals Full integration of business functions Empowered, motivated workforce Reliance on natural work teams
Proven, standard processes Roles & responsibilities known by all Negligible variation in work practices Accountability is accepted part of job Employees’ contribution rewarded Natural work teams self-directed Full integration of functional groups
Strategic business plan governs Detailed tactical operating plan Effective universal communications Cascading KPIs effectively measure Asset utilization is optimum Risks are known and well managed Budgets are activity-based
Culture of continuous improvement All decisions are data-driven Stretch model in-place for workforce Executives leads CI and example Real-time performance feedback Loss elimination institutionalized Seek perfection is workforce’s mantra
Maturity Matrix
30© Life Cycle Engineering 2011
Educate
Involve Employees
StabilizeStandardize
Eliminate Waste
Operations Excellence
Reliability Excellence
Integrate Value Stream
Operational Excellence
Organize
First Contact
ObserveUnaware
Prepare for Change
Reliability Is Fundamental To Business Excel-lence
Business Excellence
Assess
Seek PerfectionBest-in-Class
Integrate Supply Chain
31© Life Cycle Engineering 2011
First Steps
• A journey to Business Excellence starts with:– A holistic, truthful assessment of your current state– Take nothing for granted, question everything– Develop a roadmap for the future – start with the
basics and build upon them– Have a real sense of urgency – but do not be in a
hurry
• Do not forget the workforce – your real asset– Effective change management and employee
involvement is crucial to success– Remember that change cannot be mandated
32© Life Cycle Engineering 2011
Conclusion
• Reliability is a fundamental requirements of business excellence – its not optional– Business policies and practices– Work processes, procedures and practices– Workforce development and empowerment– Physical assets
• Reliability is holistic. It cannot be limited to select functions or its focus limited to a few variables
• Business Excellence powered by Reliability
33© Life Cycle Engineering 2011© Life Cycle Engineering 2011
Thank you for your attention
Questions?