ADAMA UNIVERSITY School of Engineering and Information Technologies Investigation into Effectiveness of Agricultural Machinery Maintenance Management: The Case of Wonji Shoa Sugar Factory Thesis Submitted to the School of Engineering and Information Technologies in Partial Fulfillment of the Requirements for the Award of the Degree of Masters of Science in Agricultural Machinery Engineering By Amana Wako Advisor: Dr.-Ing Zewdu Abdi Co-Advisor: Dr. Simie Tola Department of Mechanical and Vehicle Engineering June 2010 Adama ˙ T ¿ > y ‘ c = + A D A M A U N I V E R S I T Y
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ADAMA UNIVERSITY School of Engineering and Information Technologies
Investigation into Effectiveness of Agricultural Machinery Maintenance Management: The Case of Wonji Shoa Sugar Factory
Thesis Submitted to the School of Engineering and Information Technologies in Partial Fulfillment of the Requirements for the Award of the Degree of
Masters of Science in Agricultural Machinery Engineering
By Amana Wako
Advisor: Dr.-Ing Zewdu Abdi Co-Advisor: Dr. Simie Tola
Department of Mechanical and Vehicle Engineering
June 2010 Adama
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CANDIDATE�S DECLARATION
I hereby declare that the work which is being presented in this thesis entitled �Investigation into
Effectiveness of Agricultural Machinery Maintenance Management: The Case of Wonji Shoa
Sugar Factory� in partial fulfillment of the requirements for the award of the degree of masters of
science in Agricultural Machinery Engineering is an authentic record of my own work carried
out September to April 2010 under the supervision of Dr.-Ing Zewdu Abdi Department Of
Mechanical And Vehicle Engineering, Adama University, Ethiopia.
The matter embodied in this thesis has not been submitted by me for the award of any other
degree or diploma. All relevant resources of information used in this thesis have been duly
acknowledged.
Amana wako ____________ April 20, 2010 Candidate Signature Date This is to certify that the above declaration made by the candidate is correct to the best of my
knowledge and belief. This thesis has been submitted for examination with our approval.
Zewdu Abdi (Dr.-Ing) ______________ April 20, 2010 1. Advisors Signature Date
Simie Tola (Dr.) ____________ April 20, 2010 2. Co-Advisors Signature Date
ADAMA UNIVERSITY School of Engineering and Information Technologies Department Of Mechanical and Vehicle Engineering
Investigation into Effectiveness of Agricultural Machinery Maintenance Management: The Case of Wonji Shoa Sugar Factory.
By-Amana wako
Approved by Board of Examiners:
________________ ________________ ____________
Chairman/ Department Signature Date
________________ ________________ ____________
Advisor Signature Date
________________ ________________ ____________
Co-Advisor Signature Date
________________ ________________ ___________
Examiner (Internal) Signature Date
________________ ________________ ____________
Examiner (External) Signature Date
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ACKNOWLEDGEMENTS
I would like to express a sincere and special Thank to my advisor Dr.- Ing Zewdu Abdi for his
continuous support, guidance, creative ideas, thorough correction and suggestions greatly
contributed in doing this thesis.
I would like to thank also my co-advisor Dr. Simie Tola. Special thanks to professor Chandra
Rao for his indispensable help in editing, thorough correction and continuous guidance in doing
this thesis. I wish also to express my genuine appreciation to Assistant Professor Kasim Kimo for
his valuable advice and comment in doing this thesis.
I would like to acknowledge wonji shoa sugar factory (Enterprise) management and workers
who insisted me to collect necessary data. Especial thanks to Ato Yohannes Tamir (head of field
equipment service department), Ato Habtamu Awugichew (field equipment service department
planning and inspection head), Ato Esayas Madebo (wheel tractor section head), Ato Taddese
Bekele (Heavy equipment section head), Ato Heliso Heramo, and all other works of enterprise
for their unreserved assistance in accessing data for the study.
I would like to thank also Ato Mekonnin Liban co-ordinator of Vehicle Engineering section and
Ato Assefa Marga for their encouragement both in moral and material.
My gratitude goes to my brothers Ato Muktar Husen and Ato Jemal Kedir for their indispensable
help and encouragement in all aspects of the thesis work.
Finally and most importantly, my heartfelt affection goes to my wife Fatuma Sheka and my
3.4. Origin and Makes of Field Equipments (Machinery of WSSF) ------------------------------46 3.5. Down Time and Availability-----------------------------------------------------------------------48
3.6. Capacity of Man Power-----------------------------------------------------------------------------53
3.6.1. Training of Repair Crew--------------------------------------------------------------------57
Figure 3.1 Management structure of WSSF-----------------------------------------------------------40
Figure 3.2 Current condition of machinery Vs quantity in Percent--------------------------------42
Figure 3.3 Age of machinery Vs quantity-------------------------------------------------------------43
Figure 3.4 Replacement reason Vs quantity to be replaced in percentage------------------------45
Figure 3.5 Educational profile Vs quantity in percentage-------------------------------------------54
Figure 3.6 Operators education level Vs quantity----------------------------------------------------57
Figure 3.7a comparison of SLM & DBM depreciation ---------------------------------------------71
Figure 3.7b comparison of salvage value in both methods -----------------------------------------71
Figure 3.8 Capital recovery VS effect of age---------------------------------------------------------73
Figure 3.9 Insurance cost with respect to age of machinery----------------------------------------74
Figure 3.10a Yearly accumulated repair and maintenance cost (birr) ----------------------------76
Figure 3.10b.Yearly accumulated repair and maintenance cost (birr) ----------------------------77
Figure 3.10c Yearly accumulated repair and mainetenance cost (birr)---------------------------78
Figure 3.10d Yearly accumulated repair and maintenance cost (birr) ----------------------------78
Figure 3.10e Yearly accumulated repair and maintenance cost-------------------------------------79
Figure 3.10f Yearly accumulated repair and maintenance cost-------------------------------------80
Figure 3.10g Yearly accumulated repair and maintenance cost-------------------------------------80
Figure 3.10h Yearly accumulated repair and maintenance cost ------------------------------------81
Figure 3.11 Yearly accumulated repairs and maintenance cost-------------------------------------82
Figure 3.12a Yearly fuel consumption theoretical and actual --------------------------------------84
Figure 3.12b Yearly oil consumption theoretical and actual ----------------------------------------85 Figure 3.12c Yearly fuel consumption theoretical and actual --------------------------------------86 Figure 3.12 d Yearly oil consumption theoretical and actual ---------------------------------------86
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List of Appendixes
Appendix -1 Repair and maintenance factor for field operation of agricultural machineries
Appendix -2 Accumulated repair costs as a percentage of new list prices
Appendix- 3 Capital recovery factors of agricultural machinery
Appendix-4 Field equipment service department agricultural machineries
Appendix- 5 Trade in Value
Appendix- 6 Same Machineries Waiting For Spar Part
Appendix -7 Agricultural Machineries which are in sever whether condition due to lack of
shelter
Appendix -8 Dusty Work Shop Area
Appendix-9A Comparison of theoretical, actual and variance of fuel and oil cost of cameco
loader-2254
Appendix-9B Comparison of theoretical, actual and variance of fuel and oil cost of Case
Excavator, 1288
Appendix-9C Comparison of theoretical, actual and variance of fuel and oil cost of MF 4260
Appendix-9D Comparison of theoretical, actual and variance of fuel and Oil cost of Same
MF 398
Appendix-9E Comparison of theoretical, actual and variance of fuel and oil cost of FNH-110-90
Appendix-9F Comparison of theoretical, actual and variance of fuel cost of Case Same 130-DT
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Acronyms 2WD Two Wheel Drive
4WD Four Wheel Drive
AH Accumulated Hours
ARM Accumulated Repair and Maintenance Cost
ASAE American society of agricultural Engineer�s standards
CAT Caterpillar
CLP Current List Price
CM Corrective maintenance
Co Complete Overhaul
CR Capital Recovery
CRF Capital Recovery Factor
DBM Diminishing Balance Method
DP Depreciation
DT Total Depreciation
EUL Estimated Useful Life
EXCV Excavator
FC Fuel Cost
FD Ford
FESD Field Equipment Service Department
FNH Fiat New Holland
HES Heavy Equipment Section
Hp Horse Power
HVA Hangler Vondr Amsterdam
I Inspection
LPCD Land Preparation and Cultivation Department
MF Massey Fergusson
MS Maintenance Scheduling
NTAF Nazareth tractors assembly factory
OC Oil Cost
PdM predictive maintenance
PM preventive maintenance
x
Po Partial Overhaul
PP Purchase Price
PTO power takeoff
RF Repair factors
RI Rate of Interest
Rv Remaining Value
S Servicing
SdM scheduled maintenance
SLM straight line method
SPM Spare Part Management
Vs Versus
WSSF Wonji Shoa Sugar Factory
WTS Wheel Tractor Section
YD Years Digit
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Abstract This thesis is studied on the subject ��Agricultural Machinery Maintenance Management
system�. It is found that improved maintenance system assists to increase productivity of the
enterprise/Wonji Shoa Sugar Factory (WSSF) by increasing machinery work effectiveness and
availability. The enterprise must have effective maintenance plan and replacement policy of
machinery by which the whole firm will follow and should be directed in the same way to reduce
equipment downtime. Furthermore, setting up of effective maintenance management system and
preventive and planned maintenance is the way in which repair and running cost can be reduced.
This can be done through planning to build capacity of maintenance staff and implementing
preventive maintenance in accordance with maintenance discipline required so that frequent
failure of machinery will reduce so as to increase machinery availability. Generally the study
was conducted by gathering data from primary and secondary sources, interview and
observation. Maintenance management parameters like training of repair crews and operators,
educational profile and experience of maintenance personnel, work shop equipments and
facilities, machineries� annual working hours and working condition, availability of spare part
and maintenance standards were considered. The major finding of study was indicated that
agricultural machinery maintenance management parameters in the enterprise were inefficient
and operating cost was also significantly higher. Proper attention was not given by the factory�s
management. Generally poor maintenance management system practiced resulted to high
expenditure to the enterprise. Based on the findings the researcher recommended the best ways
of improving maintenance activities so as to reduce maintenance expenditure.
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CHAPTER ONE
INTRODUCTION
Agriculture is the backbone of Ethiopian economy. Eight five percent of our population live in
rural areas of the country and depends upon agriculture (CSA, 2003). Indirectly the urban
dwellers consume agricultural product which are produced by rural farmers.
As one part of agricultural industry, sugar cane plantation is very important agricultural sector in
our country. Nowadays the demand for sugar is rapidly increasing. To fulfill this demand
government and private organizations are investing to plant new factories and implementing the
expansion of the existing sugar cane plantations.
Factories which are producing sugars have so many agricultural machineries which are used to
cultivate farming, applying fertilizer, harvesting cane, and transporting of cane from field. These
machineries play a great role to prepare input to the factory. Effective chain of operation of
machinery results to the optimum production of sugar.
Wonji shoa sugar factory is located 110 km from the capital and 10 km from Adama town. The
factory has total area of 7022 hectors; average annual production of sugar is 700,000 quintal. It
has about 7,000 workers (Yohannes, 2001).
The factory accommodates a large number of agricultural machineries: tractors and heavy
machineries. The factory has a garage which has three sections i.e. tractor section, heavy
equipment section, and light duty vehicle section where maintenance and servicing are taking
place. All these machineries and vehicles are managed and handled by these sections. Generally
agricultural machineries are labor required in industrialized society. The requirement in the past
were mainly to release human labor from heavy physical labor, but now a days it is emphasized
to make machinery work quickly, efficiently, precisely and easily in addition to operators safety
(Kobayash, 2003).
The garage is very old which served for about 48 years with old maintenance management
system. The equipment failures were rectified through breakdown maintenance action while
preventive maintenance is used to reduce the occurrence of failure because the failure of
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machineries frequently can cause serious economical and social consequences. Maintenance
budget of FESD (field equipment service department) is very high and it increases at the rate of
18.25% production cost per annum. This resulted in reduction of profitability of enterprise and
increased additional cost. Therefore, maintenance should be done so as to achieve the objectives
of the organization by making the rational between breakdown and preventive maintenance and
optimizing higher availability of machineries through reducing down time. Higher availability
increases productivity which interns increases the effectiveness of working. Effective
maintenance management is one way of improving productivity. Maintenance is a technical
discipline which plays a great role to maximize the performance, availability and prolong the life
the machinery.
An effective machinery maintenance program and efficient management systems are essential
for economic, valuable and operational safety of machinery. In this paper the researcher
investigated the sources of frequent failure of machineries, high maintenance cost and cost
reduction method. In general, the paper investigated impact (effectiveness) of agricultural
machinery�s maintenance of Wonji Shoa sugar enterprise.
1.1. Statement of the problem The factory garage provides maintenance services for different types of agricultural machineries.
The main important department for this factory is this section. In this section some of the
machineries are failing frequently. Generally, the maintenance system of the garage is incurring
much cost which results in overall budget of this section increased by 18.25% per annum. This
increases the cost of maintenance, and intensive budget has to be provided because of
maintenance expenditure. This also results in reduction of profit of the factory. Therefore, this
problem needs attention, and unless some correction methods to the existing maintenance system
are taken the company will suffer huge losses.
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1.2. Objective of the study
The main objective of this study is:
- to investigate the existing maintenance management of the factory�s garage in
order to improve existing maintenance system of the machinery.
- to optimize and implement effective maintenance management in the garage.
- to reduce intensive budget consumed and overall cost of maintenance.
1.3. Significant of the study The main significance of the study is to bring and implement effective maintenance management
to the factory�s garage and to provide better maintenance activity. In doing so, the factory�s
garage extended expenditure will be reduced and profit will be high. The first beneficiary will be
Wonji Sugar Factory and other similar institution which can utilize the information developed
within this thesis.
1.4. Research methodology
This study has exploited various research methodologies by exploring their contribution toward
the best success of anticipated results. Hence the study used primary and secondary source of
information. The relevant primary sources contain original, row, uninterpreted and unprocessed
information. The relevant secondary data were collected from maintenance technical manual and
documents, monthly and annual reports of FESD, plantation, harvesting, finance department,
planning and inspection department of the WSSF (enterprise). Primary information was also
gathered using discussion, nonstructural interview, and direct observation on site visiting enables
the investigator to keep relevant data for the study.
Data collection was quantitative and qualitative in nature. Quantitative data is a data which
express anything in quantity, in number, in percentage and can be measured. Qualitative data
which express anything in quality like good, fair, bad, sufficient, insufficient etc. the
methodology has quantitative nature because of the fact that quantifiable measure of variables
can be organized, formulated, analyzed and conclusion was drawn from the sample population
taken.
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The data required for the investigation was identified and gathered by communicating
maintenance department head, section head, chief mechanics, finance department staff, planning
and inspection team, external relation office, documentation class, plantation and harvesting
department of wanji shoa sugar enterprise. Data include number and status of machinery, service
life and purchased year, purchased price, number of maintenance and operators staff, educational
background, age and service life were part of it.
Based on maintenance activities like equipment history recording system and service manual ,
machinery periodic maintenance condition were investigated, whether it took place with
accordance of manufacturer recommendation or not.
To determined cost of agricultural machinery sample of machineries were selected based on
type, age, model, horse power and nature of their work. Effect of annual operating of machinery
for a long period of time on machinery�s useful life and depreciation using both straight line and
declining balance method were also determined. Fixed and operating cost, Accumulated repair
and maintenance cost, data were formulated and analyzed by using correlation analysis in order
to compare theoretical with actual costs.
A focused discussion and non-structured interview were held with the respective maintenance
head and section head by visiting them frequently on culture and status of maintenance,
maintenance work shop facilities and equipment and man power capacity. Having the result
gathered, the condition, culture and system of maintenance in WSSF FESD can be pin pointed.
Finally, after analysis all what were incorporated the best method and approach of maintenance,
man power capacity required, work drop facilities, areas, and equipment and all what should be
done were recommended in order to improve the existing maintenance system of WSSF FESD.
5
CHAPTER TWO
LITERATURE REVIEW
2.1. Definition of maintenance
Maintenance can be defined as those activities required upkeeping a facility in as built condition,
so that it continues to have its original product capacity (Gopalakrishinan & Benarji, 2006).
From the above definition, it can be seen that maintenance is necessary to keep any product or
system with a finite life span, operating at an acceptable level, so as to support the needs of the
user or organization.
The maintenance department is one of the greatest losses of profitability that any capital
intensive organization has. An average 40-50% of the capital intensive industries operating
budget is consumed by maintenance expenditure (Ohita, et.al. 1988).
Every machine and other service facilities are subject to deterioration due to their use, exposure
to the environmental condition. If this process of deterioration is not checked it may render them
unserviceable. It is therefore necessary to attend them from time to time to repair and recondition
them so as to enhance their life economically.
Every machine is thoroughly tested and proper attention means, lubrication, cleaning, timely
inspecting, and systematic maintenance. Unless, proper attention is not experienced it resulted to
unplanned shutdown of the company. Thus the maintenance is the responsible for the smooth
and efficient working of an industry and helps in improving the productivity. It helps also in
keeping the machine in the state of maximum efficiency with economy (Sharma, 2003).
2.2. Status of maintenance In the United States, it was estimated that in 1979 over two billion dollars was spent on
maintenance. However, more disturbing than the amount was the fact that approximately one
third of that total was spent unnecessarily. As we continue to the present, there has been no
significant change in maintenance policy, Indicating the unnecessary cost trend is probably still
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one-third and largest change in the maintenance costs is the amount. Since 1979 maintenance
cost has risen between 10 to 15% per year. If this amount is calculated, it is very likely that the
maintenance expenditure in the United States is now even one-half trillion dollars. Where due
this unnecessary costs occur in maintenance? How can they be controlled? According to
Wireman (1990), these questions can be best answered by looking at some statistics.
Less than 4hr/day (out of a possible 8) are spent by maintenance crafts men performing hands-on
work activities. This figure is even more alarming when it is realized that the majority of
maintenance organizations are performing as few as 2 hr of hands-on work. It is not that these
individuals are lazy or shrinking job responsibilities. It is the fact that they are not provided the
necessary resources by management to perform the assigned job tasks. Providing these resources
becomes important to increasing maintenance productivity and producing substantial
maintenance labor savings. If we would view maintenance salaries as a resource, $20 per hour is
paid and only utilizing this resource at a 50% level; that is a tremendous cost waste.
Only about one-third of all maintenance organization uses a job planner to plan maintenance
activities. Most experts agree this is one of the largest potential for cost savings in the
maintenance area. It is estimated that planned versus unplanned work may have a cost ratio as
high as 1:5 performing a $100 planned work could save as much as $400 over performing the
same job in unplanned mode.
The majority of all maintenance organizations either are dissatisfied with or do not have work
orders systems. This is one of the critical indicators of the status of maintenance Organization. If
a maintenance organization does not have a work order system in place that works properly, it is
impossible to measure or control maintenance activities.
Of companies that have work order systems (one-third of all companies) only about one-third
tracks the work orders in a craft backlog format (actual 10% of total organizations). This format
will permit the manager to make logical staffing decisions based on how much work is projected
for each craft. Being able to justify employment levels to upper management is a necessary
function of good maintenance management.
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Of companies that have work order system, only one third compared their estimates of the work
order labor and materials to the actual figures. Again, this means only about 10% of all
organizations carry out some form of performance monitoring. Successful maintenance
management requires performance monitoring.
Of the companies with work order system that allows for feedback, only one-third, again about
10% of all companies, perform any failure analysis on their breakdowns. Most of the other
companies are just parts changers. For an operation to be cost effective, good practice in failure
analysis must be followed.
Over time, another key indicator, in the United States averages about 14.1% of the total time
worked by maintenance organizations. This figure is almost three times what it should be. Since
maintenance is working so much overtime, it again indicates the reactive Situation that is
standard in the industry. Reducing overtime is essential if a maintenance organization is to be
truly cost effective.
Preventive maintenance, another major part of any successful maintenance program, is presently
satisfying the needs of about 22% of the maintenance organizations. This again illustrates major
problems for the maintenance organizations. Without successful preventive maintenance
programs, maintenance can only react to given situation. Preventive maintenance allows the
organization to plan better and reduce maintenance costs. Over three-fourths of the organizations
need major improvements in this area.
Related to preventive maintenance, almost three-fourths of the organizations have some form of
lube routes and procedures. While this fact seems to be positive on the surface, it is not. Many of
the organizations feel that preventive maintenance is nothing more than lube routes and
procedures. So once they have these developed, they stop. However, preventive maintenance
encompasses much more than lube-routes. To be successful, maintenance organizations must go
beyond the preliminaries and fully develop preventive maintenance programs.
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One final fact related to preventive maintenance is the lack of coordination between operations/
facilities and maintenance. Almost three-fourths of all organizations experience problems in
coordinating preventive maintenance with the operations/facilities group. The problem is with
communication. Either the maintenance organization has not communicated the need for the
preventive maintenance or the operation/facilities group is not listening. Good, credible
communication must be established if preventive maintenance is to be effective.
Second only to maintenance labor is the cost of maintenance materials. Depending on the type
of operations / facility maintenance, materials can range between 20 and 70% of the maintenance
budget. To manage maintenance successfully, materials must be given close scrutiny.
A third point of concern for maintenance materials is that maintenance is only responsible for
their inventory in about 50% of the organizations. This means the other 50% of the time, another
body is telling maintenance department what they should stock and how many they can issue.
While most thus agree that maintenance costs are high, they do not know how high they are for
their own site. In most cases, the costs of maintenance repairs are calculated as the cost of
maintenance labor and the maintenance materials to affect the repair. What larger figure that is
not added is the cost of lost production/service. The range for this cost may be from 2 to 15 times
the cost of the maintenance repair. The average is usually 4 to 1. So while a maintenance repair
in labor and materials may be 10,000.00, the actual cost is really closer to 50,000.00. In fact, it is
estimated that in the next several years the annual maintenance cost will exceed the amount spent
on yearly new capital investment.
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2.3. Objective of Maintenance Management Maintenance management is concerned with a good control of the maintenance function and its
related areas in order to best assist the objectives and goals of the entire organization. It is a
combination of all technical and administrative action to retain an item in, or restore it to the
state which it can perform its requirement under normal stated condition. In short, maintenance
management can simply be defined as managing the maintenance activity to ensure the
availability of equipment and facilities and keeping the downtime to a minimum. As such
maintenance management supports the effective operation process by eliminating and reducing
the frequency and severity of equipment failure (Teklehaimanot, T.2007).
In general the main objectives of the maintenances are (Sharma and Gopalakrishinan,.2003 &
2006):
-to ensure maximum availability of plant, equipment and machinery for productive
utilization through planned maintenance
- to maintain plant and equipment and facilities at an economic level of repair at all
times to conserve these and increase their life spans.
-to provide the desired service to operating departments at optimum levels through
improved maintenance efficiencies.
-to reduce cost of the lost production due to breakdown.
-to provide management with information on the cost and effectiveness of
maintenance
The economic factor has to be kept in mind by all the contributing department of an organization
because, whatever be an aim and objective of that organization, it cannot sustain for a long with
earning profit. So, it can be safely said that the primary objective of maintenance department is
to extend helps to achieve this goal by creating capabilities within the enterprise to earn profit.
Since the ultimate objective is profit, the production infrastructure and facilities have to be
maintained at as minimum cost as possible with maximum efficiency and operational
availability.
The main objectives of properly run of the maintenance department is to have plant, equipment,
and machinery available for productive utilization during the scheduled hours, operating to
10
agreed standard with minimum waste and minimum total cost. The total cost is the sum of
maintenance labor cost and material cost plus cost of loss in production.
Gopalakrishinan (2006) shows how the lowest total cost can be achieved from fig. (2.1)
Fig.2.1. optimum maintenance cost
a, If maintenance cost (m-curve) is at zero, then it indicates that no maintenance is being carried
out at that point and the cost of production loss ( see p-curve ) is at the highest or at its peak. b,
as the maintenance effort is gradually being introduced and increased (m-curve ), the production
loss (p-curve ) slowly decreases. C, following the total curve (T-curve pattern, we notice that the
effect mentioned in point b, holds true till we reach the minimum combined cost level at point A
(T-curve ). Thereafter, any additional maintenance effort being applied increase cost.
This clearly shows that maintenance optimizing technique indicates that point A on the T-curve
is the objective for the maintenance to achieve: because at that level we get the minimum
combined cost. This observation is also equally true for the service sector organizations.
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2.4. Importance of maintenance Components, subunits, subsystem, system of equipment and vehicles are designed, manufactured
and assembled from processes row material and energy by the aid of human labor and necessary
tools. Their manufacturing and assembling process follow scientific law in an economic way that
will be achieve by maximizing performance and quality equipment/machinery reducing cost.
Furthermore, in order to continuously perform their intended mission or be available to perform
their mission we needed, the following factors have to be analyzed and determined thoroughly
during, manufacturing and assembling process (Teklehaimanot, T.2007). These factors are:-
Reliability: the ability of an item to perform the function under static condition for stated period
of time. With this regard, during designing, manufacturing and assembling activities, care must
be taken in order to maintain high reliability of operation at accepted added cost. According to
Sharma (2003) reliability is the capability of equipment works well and works whenever called
upon to do the job for which it was designed. The general accepted definition of reliability is the
probability of a device performing its purpose adequately for the period of time intended under
the operating condition encountered.
Maintainability: the ability of machinery/equipment under stated condition of use to be retained
or restored to estate in which it can give its original performance, which maintain is performed
under stated conditions using stated procedures and resources. Therefore the aim of
maintainability is to reduce down time of the equipment (Sharm, 2003) which includes:
-time to carry out preventive maintenance
- time taken in fault analysis, time taken to repair, time taken to subsequent testing
Availability: According to Demise (2002) availability performance is a measurement of
maintenance efficiency and can be defined as measurement of performance of equipment in the
terms of ability to operate without problem in despite of disturbance and limitation of
maintenance resources.
Human factors ergonomics: human factors refers to the design system or a product/ service
with human being in mind that is the design for operability and ease of maintenance
consideration includes physical dimensions of the human body, human sensory factor,(sight,
12
hearing, feel or touch, smell, Physical factors the effects of environmental stress on the body)
and psychological factors pertaining to the human mind emotion, traits, attitudinal response and
behavioral pattern as they relate to job performance.
2.5. Scope of maintenance The task of machinery maintenance is to transform row materials, energy and human labor in to
use full products by following scientific laws in an economic ways which will be achieved by
maximizing performance and quality while reducing costs. In order to produce facilities,
transport and cargo perform agricultural duties machineries /vehicles are assembled by designing
and manufacturing their components with limited life span. Moreover, errors during designing
and manufacturing might result in lower requirement life. Therefore, equipment designer have to
consider maintainability of equipment before it is manufactured. Maintenance is a discipline of
engineering which tries to maximize the performance of machinery and to prolong the life of
capital equipment (Demise, 2002). Maintenance consists of all activities undertaken to keep
equipment functioning with its original performance or to restore its original performance.
2.5.1. Category of Maintenance
2.5.1.1. Preventive Maintenance (PM) PM is sometimes termed as planned maintenance or scheduled maintenance or systematic
maintenance. It is an extremely important function for the reduction of maintenance cost and
prevents the occurrence of failure before they develop to a breakdown or interruption of
operation (Demise, et.al., 2002) and to keep the good operational condition of the equipment and
hence increase the reliability. PM aims to locate the source of the trouble to remove them before
the breakdown occur. Thus it is based on the principle �prevention is better than cure�.
Scheduled maintenance (SdM) is always economical than unscheduled maintenance as well all
knows that �a stitch in time saves nine�. Best safeguard against costly breakdown is to inspect,
lubricate, and check up the equipment as frequently as possible. To take full use of machinery
and maintain it in reliable condition. Necessary measures should be taken to prevent overloading,
13
dampness and negligence and misuse of machines frequency of inspections should be decided on
the basis of importance of the machines, tear and wear of the machines and its delicacy. Thus
periodic inspection or checking helps to find out the reason leading to breakdown and rectify
them when they are in minor stages. Thus there repair can be done when one wants to do it. That
is when it has least effect on the production schedule. Further this repair requires lesser time as
required as compared to that of break down repair and thus down time is reduced (Sharma,
2003).
PM includes the following important function. That is; inspection and check up for internal and
external, servicing which include cleaning, cooling and lubrication, planning and scheduling ,
recording and analyzing, training of maintenance staff and strategy of spare part (Ladet, 2009).
For the success of preventive maintenance sound training is essential for the maintenance
personal. Hence, the technicians and supervisor and trained to carry out maintenance, inspection
and repair in a systematic way.
Fig.2.2 Categories of PM (Demise, 2002)
According to Taylor (2003), equipment that is operated can fail and not all failures can be
prevented. Preventive maintenance forms the backbone of a planned maintenance system. PM
takes either fault finding (inspection) or preventive replacement. The routing of time directed
Preventive maintenance
Indirect PM, Condition based maintenance
Direct PM, fixed time maintenance
Condition monitoring Failure detection before break down
Condition based replacement
Fixed time replacement
Adjusting, cleaning, and lubrication
14
task s fosters discipline and focus in the maintenance organization. A well designed program has
standard daily and weekly routing that encourages systematic planning and performance of
2.8. Planned Maintenance System All work is planned! If it is not preplanned, it is planned during execution, pre-panning includes
needed parts materials and skills are available. Multiple trips are to the tools room or store rooms
are eliminated, crafts are coordinated, avoiding wasted man power caused by people standing
around waiting. Work planned during execution suffers from false start, missing parts or
information and wasted man power. Works that is not pre-planned can cost you as much as 25
percent more to accomplish (Taylor, 2003).
A good planned maintenance system is designed with optimal mix of PM and PdM task. As
much CM as possible is planned to make best use of man power and spares. A number of
unplanned repairs are minimized. A good planned maintenance system will reduce the number of
emergency repair to a minimum because many of failures that could happened are found early
while doing PM or PdM tasks. Because they are found before the failure occurs. They can be
repaired with the least impact on production.
19
2.9. Manpower planning To achieve maximum production at low cost and at desired quality, right man at right place, at
right job and at right time must be put. This is what is called scientific man power planning. This
reduces idle hours, cost of products and help to step up the moral of employees. It also develops
cooperation and team sprit among each other. Man power planning may be defined as specific
process of allocating the right quantity of right men to be required in future at right time on the
right job.
Manpower planning involves two stages. The first stages concerned with detailed planning of
manpower requirements for all types and level of employees throughout the period of the plan
and the second stage is concerned with the right type of people from all sources to meet the
planned requirement.
One of the obvious reasons for training is that the employee can�t do something that the job
requires to be done. It explained that there is some skill they have yet to perfect or acquire or
some knowledge they are lacking and keeping them from doing a completely satisfactory job.
This reasons enough to make training necessity. Training is an integral part of building g
capacity technicians /employees who engaged with machinery maintenance. Training the
operators and the maintenance worker helps to achieve zero breakdowns as many break downs
are results of lack of skill (Johansson and Nord, 1999).
This will enable the operator to maintain their own machines, understand while failure occurs
and suggest way of avoiding the failure occurring again. Generally training is continuous process
and it can be successfully planned and implemented, only if the organization has a proper policy
and has the support of its top management. The chief maintenance manager is responsible to
planned and train his personnel with their level i.e. worker level, supervisor level and executive
level. He does this usually by making detail documents clearly projecting the maintenance
requirements of the organization training.
20
The most wanted ability from operator
- Ability to find and improve equipment minor defect sources.
- understand equipment function and mechanism and have the power to find the cause
system of troubles.
- understand the relationship between employment and product quality and have power
to predict problems with quality or to find cause system.
- To repair
- can perform individual duty of the machine operator job.
The Most Wanted Ability from Maintenance Men
- Can instruct the correct operation and daily maintenance of equipment
- can judge if the equipment is operating normally or abnormally
- Can analyze abnormal condition cause and can select and implement correct restoration
- method.
- Can enhance equipment and part reliability, extend life and suppress abnormal
- Condition of failure.
- can enhance equipment maintainability by such as unit exchange and can shorten repair
and restoration time.
- Have technological power to diagnose equipment and can utilize and standardize it.
2.10. Planning For Machinery /Equipment Disposal
2.10.1. Disposal Policy The objective of machinery /equipment disposal policies and procedures are to (Demise, 2002):
maintenance polices control over equipment during its needed service year.
ensure an orderly, logical assessment is made of equipment, worth responsibility,
Potentially extended life and productivity before any decision is taken to sell or
scrap equipment.
ensure the proper authorization, check and approval have been obtained before equipment is
written off.
prevent cannibalization of equipment before the proper authority is received to do so.
provide a set of guideline for orderly equipment disposal when a proper approval has been
obtained.
21
ensure that unusual machinery /equipment or scrap is removed from usable storage or operating
space.
It can be overemphasized that the cannibalized/striping dawn of equipment for parts will not be
condoned unless the proper authority has been obtained. Unauthorized action of this sort must be
considered act of vandalism and must be treated accordingly.
2.10.2. Disposal Criteria Equipment should be considered for disposal or written off if they satisfy one or more of the
following criteria (Tesfaye, 2002):
- Beyond repair: The equipment is totally destroyed and obviously beyond economic recovery.
- Parts unobtainable: repair parts for the equipment are not in the stock or unobtainable
because the, model is obsolete or unsupported by the manufacturer or his agents.
- Repair costs unsatisfied: restoration repair, while possible, cannot be economically
justified because :- planned future utilization of the equipment is low; operating costs will
be greater than that of new replacement machinery/equipment; work productivity of the
restores machinery/equipment will remain unacceptable low.
- Inferior productivity: the equipment possesses a productivity profile inferior to that of
comparable machinery making its unit output costs higher.
- Equipment missing or stolen: the equipment has been stolen or removed without your
knowledge or authorization or has been missing for two years.
22
2.11. Maintenance Scheduling (MS) A maintenance schedule indicates what the work to be done is, how often it is to be done, by
whom it is to be done, and the estimated time required to complete the work. Separate schedules
have to be prepared for each type of maintenance activity which has to be carried out on each
type of items as per the facility registered (Gopalakrishinan & Benerji, 2006).MS is the essential
arrangement by which maintenance is done. The guide lines for the maintenance engineer should
be laid down by the manufacturer. But one can�t depend exclusively on these instructions. In
order to have a workable system, the actual condition s of the operations, the severity of the use,
and the skill level of the operators etc will have to be kept in mind.
The decision on the sequence is based on the priority, the availability of the spares and materials.
Scheduling can be effective only if there is confidence, mutual cooperation and understanding
the production and the maintenance department (Palmer, 1999).
The first element of scheduling program is to shorten the delay of the time a defective
equipment piece is identified and the time it can be worked on. The second element of program
is to improve the scheduling system�s memory. When a piece of defective equipment is
identified often no action will be taken on it immediately, because operation needs the equipment
on line. In this situation, the scheduling system may not remember that the equipment is
defective, unless there is an explicit record keeping system. The second element of the policy
implements an efficient record keeping (Gopalakrishnan & Benerji, 2006).
2.11.1. Scheduling Process Every day in the morning the supervisor assigns work individually to each worker and keeps him
informed as to what work expected of him the next day. This allow the worker enough time to
know what he has to do, and having advance intimation, there can make timely arrangement for
the spares, the materials and the tools which he will need the next day and thereby get ready for
the job to be done in advance (Sharma, 2003).
23
For success in scheduling process we should have full information so that the scheduling can be
optimal value. The information needed for this are man power availability report, latest status
report of material and production plan, backlog report, and maintenance request received etc.
2.12. Maintenance Record and Documentation Maintenance recording of information has to be decided as to what kind or simple type of
information is needed and the kind of use it will be put to , only then the depth and detail to
which recording needs to be done can be decided. A large variety of farm is different formats are
available, from the simplest to the most compressive ones for use in the organization.
History record card: is one of the most use full and essential records which must be maintained
in the maintenance control. A periodic analysis of this document will help the maintenance in a
variety of ways:
1. The frequently repeated faults, finding their cause and deciding about the corrective
action to be taken.
2. Finding out the parts and spares needing frequent replacement and there causes. This will
determine the exact cause and help take corrective action.
3. If break down occurs soon after the maintenance team has worked the machinery/
equipment, then it may indicate a weakness in the maintenance quality or even on the
inadequacy of skill level.
4. Certain repeating failure which occurs despite spares being replaced may either indicate
the use of spurious parts, or that the spares are in need of improvement from the design or
material content point or need of being produced under the guidance of better quality
assurance programmed.
5. Certain fault and break down which may occur due to mishandling by the operating staff
would need to be set right by imparting training for the proper handling of the equipment.
6. decision regarding equipment to be selected for standardization and for replacement
become much easier when the complete background is available for comparison between
the different makes of the same equipment from the point of view of ownership cost,
maintenance cost, down time cost, and availability.
24
2.13. Spare Part Management (SPM)
Machines worth a millions of money are idle due to shortage of spares; on the other hand huge
stocks of spares are lying which perhaps may not be used. This emphasizes the need of paying
attention on the management of spares, improvement in the capacity utilization and cost
reduction can be achieved by better spare part management. The objective of SPM is to provide
right parts in right quantity, in right place, at right time and at right cost. The part must be
codified and classified. Various cost reduction technique for spares help the manager to control
large number of spare part selectively and efficiently which helps to utilize his energy to problem
areas resulting in optimal use of his efforts (Sharma, 2003).
2.14. Determination of Cost of Agricultural Machinery
Agricultural machinery cost can be divided in to two categories. These are; annual owner ship
cost, which occurs regardless of machine use and operating cost which vary directly with the
amount of machine use. The true value of their cost is not known until the machine sold or worn
out but costs can be estimated by making a few assumption about machine life, annual use, and
fuel and labor price (Hunt, 1983).
The distinction between fixed cost and running cost is not always clear out (Goense, 1995),
whilst depreciation or loss in value of machines with age is tested as a fixed cost. This is only
realistic under average condition of operation. As economic life of the equipment is reduced by
heavy usage, part of depreciation change is dependent of utilization. Conversely, repair and
maintenance is taken as running cost but maintenance may still be required, even when the
machine is little used. This part of running cost is linked to duration of ownership (Witney,
1988).
25
2.14.1. Fixed Cost
2.14.1.1. Depreciation
Depreciation is a cost resulting from wear, obsolescence and age of the machine in which every
machine losses its value (Hunt, 1977). Whenever a machine or equipment performs a useful
work its wear and tear is bounded to occur. This can be minimized to some extent by proper care
and maintenance, but cannot be totally prevented. Its efficiency also reduces with lapse of time
and at one time it becomes uneconomical to be used further need replacement by new unit.
Repair cost tends to increase as machinery age increases (Kasten & Dhuyverter, 2008).
Therefore, we can say that efficiency and value of machine constantly decrease (reduce with
lapse of time during use which is known as depreciation. So, some money must be set aside
yearly from the profit. So that when that equipment becomes uneconomical it can be replaced by
new one. Depreciation is a book keeping method of distributing the cost of capital item over
more than one year of useful life (economic life). Economic life depends upon a period you plan
to use the item. The economic life of machine is the number of year for which costs are to be
estimated. It often less than the machine service life. A good use of thumb is to use an economic
life of then to ten years for most new farm machines and twelve years for tractors unless the
machine traded or sold sooner (Hunt,1983).
Obsolescence: Suppose an owner purchases a machine for his production but after some
duration a better machine comes in the market, whose production rate is very high and
economical although the old one is efficient but becomes out of fashion and uneconomical due to
new better machine which has come in the market. This is known as obsolescence. Consideration
of this factor is of much important and some money should be set aside from profit for this case
(Sharma, 2003). In general, obsolescence is a depreciation of existing machinery due to new and
better invention and new design of equipment.
Types of depreciation Depreciation due to wear and tear
Depreciation due to corrosion and rust
26
Depreciation due to accident
Depreciation due to differed maintenance and negligence
2.14.1.1.1. Method of determining depreciation
A. Straight line method With this method an equal reduction of value is used for each year the machine is used. This
method can always be provided that the proper salvage value is used for an age of the machine.
But salvage value gives the price of the machine when sold. Hunt (1983) described depreciation
with SLM as in equation 3.1.
LSPAAD
3.1.
Where: AAD= average annual depreciation (depreciation amount by year)
P= purchased price of the machine
S= (salvage value =current list price ×remaining value of the machine)
L= economic life of the machine (useful life)
Figure 2.4 Straight line method
The purchase price related to machines bought either new or second hand and the resale value
after a long period of ownership may become the scrap value. During the early life of the
machine, therefore, both the resale value and the period of ownership must be assumed.
27
The advantage of straight line method of depreciation is that it is simple and straight forward. It
is most suitable for estimating costs for the entire life of the machine (Witney,1988). The annual
depreciation charged can then be considered as the sum which must be set aside each year in
order to replace the machine with identical model at the end of the period of ownership (Norvel,
2007). This, of course, assumes that the value of money remains the same and that the
depreciation fund is not reinvested, that is no inflation and interest is not considered.
The straight line depreciation method is, however, an over simplification and ignores the more
raped depreciation which occurs in the early life of the machine. This is very important when a
machine is traded after a short period of ownership (Goense, 1995).
B. Sum of the years Digit Method Sum of digit method is historical depreciation method that results in a more accelerated write off
than SLM. Salvage value is countered in the method. It is more accurate method to estimate true
value of the machine at any age because of annual depreciation rate decreases as machine get
older. Steps to be followed to determine SDM: � Add up number representing the year covered by the depreciation period.
� divide total depreciation by the sum of digit of the year for depreciation period.
� Proportion the depreciation in reverse of the years over which depreciation occurs.
D= )( SPYD
nL
.3.2
Where: YD- the sum of years digit method (1+2+3+�+L)
n- The edge of the machine at the beginning of the year in question.
D- Depreciation
L- Economic life
p- Purchase price
S-salvage value
28
C. Declining Balance Method
The declining balance method of depreciation better reflect the actual value of a machine at any
age than either of straight line depreciation method or the sum of the digit method
(Sharma, 2003). With declining balance method, machinery depreciates a different amount of
each year, but the annual percentage of depreciation (decimal rate depreciation) remains constant
or the same (Witney, 1988). Simply declining balance method works on the basis that whatever
the value of the machine has at the beginning of the years, it will be worth a fixed percentage of
that value of one year later. It depreciates in the early year and later slowly. Therefore, it is better
to depreciate much during the early year when the repair and renewable is not costly (Bowers,
1992).
Bowers (1992) describes depreciation with declining balance method as equation 3.5:
Y
LrCRV
1 3.4
nRVD - 1nRV 3.5
Where: RV-remaining value of the machinery
C-initial cost of the machinery.
r- Rate of depreciation, r is between 1 and 2. r=2 for new machinery and
if requires double declining balance and under accelerated depreciation.
r=1.5 for used machinery
L= machinery use full life
Y= age of the machine in which depreciation is determined.
lr
Decimal rate of depreciation
Therefore, depreciation is equated as:
DP=Rvn-Rvn+1 3.6
The need to use un-exponent makes the method more complex and tedious. It better reflects,
however, the actual value of a machine at any age and is more use full for calculating the value
of asset in a balance sheet (Witney, 1988).
29
Age (year)
Figure 2.5.Declining balance depreciation showing the additional effect of a first year correction
factor.
Eventhough the method doesn�t account for the first year depreciation which tends to be at
considerable higher rate than in later years. By introducing a first year correction factor to the
resale value calculation, the accuracy of the declining balance method can be improved still
further according to Witney (1988).
2.14.1.2. Interest Interest charges are usually computed when operating costs are being determined and may be
calculated so that the result will be constant or equal yearly charges throughout the life of the
machine. The interest rate can be varying but usually in the range of six to twelve (6 to 12%).
Interest of agricultural machinery can be determined as indicated in equation below (William,
2009):
rateInterestDSPI
2
3. 17
Where: I- Interest rate (birr)
P- Purchased price (birr)
S- Salvage value (birr)
D-depreciation (birr)
According to Bowers (1992), interest is a large expense item for agricultural machinery. It is a
direct expense item on borrowed capital. Even if cash is paid for purchased machinery, money is
30
tied up that might be available for use elsewhere in the business. Interest rate varies but usually
will be in the range of 8 to 10.
2.14.1.3. Tax
Tax differs from country to country, according to Goense (1995). Tractors and self propelled
machines may have yearly cost for registration plate in same countries. Vat and sale taxes are to
be included in the purchase price. Bowers (1992), describes tax, a paid on farm machinery for
place that do have property as for other properties. The cost estimated equal to one to two (1-2%)
of purchased price of the machine at the beginning of the year often used. Tax can be determined
by equation here below (Hunt, 1983):
ratetaxopriceparchaseTax ..55.2
.
3.18
2.14.1.4. Insurance Insurance policies are usually carried on more expensive machines while the risk is usually
assumed on the simpler, less expensive machines. The annual charge for insurance or risk is
assumed to be from 0.25 to 0.5 percent of the remaining value (Bowers, 1992). According to
Goense (1995), insurance is required for tractors and self propelled machines to cover third part
liability when driving on public roads. This in most cases 1% of purchased price.
For other equipment a cover against fire and accident is required which is about 0.25 percent of
purchased price. If machinery is not insured the owner will have to take the risk of accident
himself, which on the average will near the insurance cost. Other alternative is used as equation
below if the real insurance rate is known (William, 2009):
I= rateinsuranceDSP
..2
3.19
Where: I= insurance rate
P= purchased price
S= salvage value
31
2.14.1.5. Shelter /housing Machinery shelter has not been shown to increase machinery life, but it can increase a machines
resale value (Hunt, 1983). Apart from machines repair and maintenance, a tidy machinery shed
demonstrate a managerial commitment to good machines care. A purpose built machinery store
requires enclosed work shop facilities garaging for self propelled equipment (Witney, 1988). In
the Netherlands, it is common that, machinery is stored under cover (Goense, 1995). There is
tremendous variation in the machinery housing for farm machineries for providing shelter, tool:
maintenance equipment for machinery will result in fewer repair in field less and less
deterioration in mechanical part and experience for weathering (ASAE, 1999). Space required
data for machinery were estimated from the transport dimension. Even if insurance and housing
make up small part of ownership cost of a machine. Housing costs are estimated by multiplying
the housing rate per square meter by the meter of housing required
2.14.1.6. Capital Recovery of Agricultural Machinery Capital recovery is the number of dollars (birr that would have to be set aside each year just to
replace (repay) the value cost due to depreciation and pay interest costs. According to Bowers
(1992), the annual capital recovery cost is found by formula indicated and for capital recovery
factor data see appendix 3.
CR= [DTCRF] + [SvRI] 3.20
Where: CR- Capital recovery
DT- total depreciation
CRF- capital recovery factor
Sv- Salvage value
RI- interest rate
32
2.14.1.7. Inflation In a time of substantial momentary inflation, machinery manager must include the effect of
inflation on machinery planning. Inflation causes increased prices for goods and services in
future years. Decision involve a time span of more than one year are made using value expressed
in constant dollars (birr), Dollars from which the effect of inflation is deducted. The effect of
inflation; the inflation factor is equal to (1+Ii)n . Where: Ii-is inflation rate and n is the number of
years under consideration.
Table 2.1 shows the inflation factor used to obtained constant dollar value.
Time Value at 10 % interest
Inflation factor 7% annually
Real rate of return
Today 1 1 1
1 yr 1.1 1.07 1.028
2 yr 1,210 1.145 1.057
3 yr 1.331 1.225 1.086
5 yr 1.611 1.403 1.148
10 yr 2.594 1.967 1.318
25 yr 6.727 3.87 1.737
The price of 1000 dollars machine would be expected to rise to 1000+1.967(1.07)10 =1967 in 10
years. 10 years from now, the price of the machine in constant dollars as of today 1967/1.967 or
1000 dollars. The price of the machine to day based on constant dollars of 5 (fife) years age is
[1000/1.403] or 713 dollars (Hunt, 1983).
2.14. 2. Variable Cost
2.14.2.1. Repair and maintenance cost Maintenance and repairs are essential in an effort to guarantee a high standard machine
performance and reliability. Reliability is a measure of confidence which can be placed on a
machine to complete a planned duty cycle with component failure (Witney, 1988).
Repair and maintenance cost occur due to routine maintenance, wear, tear and accident. Repair
cost for particular machine varies widely from geographical region to another because of soil
33
type, rock, climate and other condition. With in local area repair cost varies from farm to farm
because of different management policy or operator skill (Bowers, 1992).
Repair and maintenance of machinery is needed to keep them reliable and to guarantee
performance and work of good quality (Goense, 1995). It is a tendency to increase as the
machinery gets age and represents the largest impact on the diagnostic cost benefits. If you hold
escalating cost down with effective scheduled maintenance (PM inspection) a driver written up
control and timely components replacement prior to failure as long as obsolescence and technical
life do not surface. You can keep the machinery longer before cost effective replacement
(Demise, 2002).
Over the life of the machine components become worn. Excessive wear adversely affects output
and increases the likely hood of the failures. This introduces the financial risk by prolonging a
critical operation either through slowly rate of work or through unforced break down.
Cost comparison: estimated repair cost versus actual cost can be shown weakly, fortnightly,
monthly and annualy. This projection will indicate if actual costs are more than, or less than, or
equal to estimated cost. If not, by how much has it deviated? Keeping in mind the actual cost
against the funds provided for in the budget is a control function (Karim, 2008). The best data for
estimating repair cost is operators own records of past experiences. Good record indicates
whether the machine has had above or below average repair cost and when a major overhaul may
be needed without such data, repair cost must be estimated from average experiences. The value
in appendix (2) shows the relationship between the sum of the repair cost for a machine and total
hour of use during the life time based on historical repair data (ASAE, 1996).
The cost of repair and maintenance exists of:
- the cost of labor and parts for repair and maintenance ; the direct cost and
- the cost of work not carried out in time because of down time; indirect cost
The indirect cost can be very high in case of downtime during a period with high timeliness cost.
They can be calculated when the occurrences of downtime can be quantified. The downtime
hours are subtracted from available time and consequences calculated.
The direct cost of repair and maintenance are presented on two different ways:
34
The total life of repair and maintenance costs as a percentage of the machines list
price and
Accumulated repairs and maintenance costs as a power function of accumulated
machine use.
When only total life if repair and maintenance costs are used it is assumed that they accumulate
linear with accumulated life. The variable repair and maintenance costs per hour are following
this approach dependent of intensity of machines use (Goense, 1995).
RCH=Pp )()100
1(
THTR
3.21
Where: RCH- repair and maintenance cost per hour
Pp - purchase price
TR- total life repair cost as percentage of PP (total accumulated repair cost)
TH- total technical life (total accumulated hours).
The second approach, the power function, describes better the typical trend in repair and
maintenance costs. Low cost in the initial stage of the machine life and increase in later life
(Witney, 1988). The power function is:
3.22
Where: ARM- accumulated repair and maintenance cost for n year as a function of
accumulated hours.
CLP (PP) - current list price
AH- accumulated hours
RF- repair factor
n- Number of years (age of the machine) in which RM cost is determined.
The coefficients of various implements are present in appendix (1)
If the machinery accumulated hours is greater than estimated useful life the equation be comes
2
10001
RFn
nnAHCLPRFARM
35
EULEULAH
RF
nnnRFEULCLPRFARM
2
2
11000
1 3.33
Repair and maintenance cost for n years of machinery will be calculated by using equation 3.24
here under:
1 nnn ARMARMRM 3.24
The accumulated repair costs are based on the accumulated repair and maintenance cost to
reduce the availability of the costs due to different in timing of the repairs (Ahimed, 1999). The
accumulated use for the tractor is given as engines hours divided by 1000, whilst that for
machinery is given as operating hours divided by 1000. As the engine hours are recorded on a
tractor hour meter which is only correct at a particular engine speed for the tractor models, an
underutilized tractor, operating at low engine speeds, will record a lower hour meter reading than
a tractor operating at maximum power for the same period. Thus, the accumulated use based on
home meter reading partly accommodates for different level of power utilization in the
calculating of tractor repair cost
2.14. 2.2. Fuel Cost Fuel consumption of agricultural machinery/ Tractor/is governed by the amount of energy
demanded at the draw bar or through the power takeoff. In order to relate this net energy
requirement to the tractor fuel consumption, it is necessary to account for the efficient of power
transmission system, tractive efficiency and the loading on the engine.
Tractor operates throughout the year on a range of task varying from heavy duty work such as
Ploughing or forage harvesting to light chores. Even for Ploughing, the fuel consumption on an
individual tractor varies considerably over the duty cycle. And the average fuel consumption for
peak power. The average engine loading throughout the year is 55 percent of the maximum
power take off (P.T.O) of the tractor.
36
Figure 2.8. Specific fuel consumption for a diesel engine operating at various power utilization ratios. The amount of fuel consumed depends on:
- the energy requirement of field operation
- the efficiency of power source, determined by transmission and tractor efficiency
- fuel efficiency of the power source and
- The type of fuel used (Goense, 1995).
According to Hunt (1983), fuel cost is calculated independently for gasoline and diesel.
Therefore,
Fuel cost for gasoline = max. P.T.O hp ×0.068×price of gasoline ×hour of use �3.26
Fuel cost for diesel = max. P.T.O hp ×0.044×price of diesel ×hour of use �3.27
2.14. 2.3. Lubrication (Oil) Cost
Lubrication plays a very important and effective role in planned or PM maintenance and rightly
therefore, it is basic to maintenance planning. Ensuring lubrication can and does reduce large
number of breakdowns. The role of lubrication where machinery is exposed to the ravage dust
and grime or to moisture and salt laden sea breezes or the punishment inflicted up on machinery
and plant in the chemical industry as a whole cannot be an over emphasized.
According to Gopalakrishinan & Benerji (2006), proper lubrication helps to: prevents rust
formation, reduce friction; thus reduce wear, scoring and seizure and economies on power
Consumption, Washes away waste material and particles, increase equipment life and reduce
heat
37
In doing so the lubrication need expense as that of fuel does. Engine needs periodical
replacement of crankcase oil. Tractors of 25kw need on liters oil for every 300 liters of fuel and
tractors of 150kw one liters on every 600 liters of fuel. On average these represents a cost of 5%
of cost of fuel (Goense, 1995).
According to Nebraska tractors test data, a general rule of thumb can be applied for power
machinery is 15 percent of fuel cost. For non-power machinery /equipment 5%of purchased price
is used.
38
CHAPTER THREE CASE STUDY OF WONJI SHOA SUGAR FACTORY (WSSF)
3.1. Historical Background of the WSSF Commercial sugar cane plantation was started in Ethiopia in 1951 by Dutch company Hangler
Vondr Amsterdam (HVA) which was granted a concession of 5000 hectors for establishing a
sugar estate and a factory in the Wonji plain which lied downstream of Awash River.
On March 20th in 1954, Wonji sugar factory had the first milling season and produce 6,000 tons
of white sugar (first bag of Ethiopian sugar). In order to meet the rising demand of sugar in the
local market another 1600 hectors of land was granted to the HVA Company by the Ethiopian
government thus totaling 6600 hectors.
During that time, even though the exact data were not found, the factory began its agricultural
(activity) with few machinery (tractors and heavy machinery) and little man powers.
3.1.1. Objectives of the Enterprise According to the Council of Ministers� regulation NO.89/1992 the objectives of Wonji shoa
sugar factory are the following;
1. to grow sugar cane and exploit other sugar yielding points.
2. to process and produce sugar products and sugar bye products
3. to study, plan and implement various sugar development programs.
4. to carry out scientific, industrial and agricultural research and survey to
enhance its program.
5. to possess and develop fulfill its purposes.
6. to distribute and sell locally and export sugar and similar products including
non-sugar products from its farm and factories.
7. to engage in other industries, conductive to the attainment of its purposes.
39
3.1.2. Mission To provide sugar, Desta candy, sugar bye product (molasses) to the required demand to achieve
the set objective.
3.1.3. WSSF Production Capacity The production capacity of the factory for 2000 E.C fiscal year was stated in Table 3.1. Table 3.1 2000 E.C fiscal year production capacity of factory. Product Sugar Desta candy Molasses
Unit of measurement Ton Ton Liters
Required out put 7600 240 261440
Achievable 8231.12 213.3 265350
achieved 7464.5 74.623 199454
3.1.4. WSSF Organizational Structure and Set Up The company has three divisions, namely agricultural division, factory division, finance and
human resource division and has fifteen departments.
The top management is organized in team. The management team consists of the general
manager, agricultural operations manager, and human resource and finance manager. Out of two
activities i.e. factory activity and agricultural activity, the second one plays the greater role in
production of sugar cane. Under this activity, land preparation, plantation, harvesting and field
equipment service are included. For the production of sugar and molasses, Agricultural
machineries/ equipment take a lion share. From the beginning of land preparation to the last step
to transportation of sugar cane to the factory these field equipments/ machineries require a great
attention. They should be handled and kept properly. Miss handling of enormous amount of all
these machineries will result to loss and reduction of sugar products. Health care of machineries
(tractors and heavy equipments) will optimize the production of sugar, unless the factory
gradually leads to shut down.
40
Fig.3.1 WSSF organizational flow chart
Managing board
General Manager
Agricultural operation manager
Finance and human resource manager
Factory and logistics division manager
Plantation department
Land preparation & cultivation department
Harvesting department
Field equipment service department
Civil engineering department
Wonji sugar factory
Shoa sugar factory
Logistics department
Confectionery works
Finance department
Human resource department
Medical service department
41
3.2. Status of Agricultural Machinery Due to traditional recording and reporting system of machinery, it is difficult to conduct a
detailed analysis of machinery status. Field equipment service department (FESD) of Wonji
Shoa Sugar Factory (WSSF) has no document that shows clearly the condition and status of
machinery. Machinery status can be easily identified if a planned maintenance and condition
monitoring is implemented. Different machineries with different service life and the same
machineries with different activities could be at different status. The performance of all of them
should be known by performance testing of engine even though clear record of machinery status
does not exist. From the interview held with wheel tractors and heavy equipment section head
the current status of machineries shown in the Table 3.2.
Table 3.2 quantity and status of machinery in FESD of two sections of WSSF s. no Machine type model Current condition and quantity of machinery
Figure 3.2 current condition of machinery Vs quantity in Percent Those machineries, which are working and delivering service and relatively low in operation
cost, well maintained and recent ones are categorized as good machineries. Under this category
those machineries which low frequency of breakdown are included. They are in better
performance in terms of operation within dust farm land. Those machineries which are operable
with the poor maintenance management system, frequent breakage of the systems which requires
high repair and maintenance cost are categorized as fair. These machineries can be maintained
and corrected by minimum and low technical complexity. The age of some machinery in this
category is not much but requires high operational cost. The main problem is lack of preventive
and condition monitoring. Those machineries which are operable and out of operation which
requires major operation cost, some of them are unrepaired. They are out of operation for years.
In these category, aged machinery which has been using with high repair cost and those which
requires disposal (out of operation for years and subjected to Sevier sun and dust) are categorized
as bad. It is uneconomical; in fact these machineries lead the WSSF to loss in production because
of high operation cost.
From the data in the Table 3.2 above 54.2% of machineries are in good operating condition. In
order to prolong the life span of these machineries FESD should implement proper preventive
maintenance management with thorough condition monitoring of machinery from time to time.
The remaining machineries which are almost 31.57% of them are in bad condition. Out of these
0.00%10.00%20.00%30.00%40.00%50.00%60.00%
Perc
enta
ge
Good Fair Bad
Condition of machinery
43
50% requires disposal. It is planned to dispose them, even though they are not disposed due to
lack of clear disposal system in FESD. Proper categorization of machineries in different status
helps to provide cost effective maintenance work. FESD should identify machineries status
thoroughly in a regular way. In doing so, FESD enables it to plan and implement replacement
policy system of the machinery.
Every machinery does have its own useful life other than physical life. The age of the machinery
determines repair and maintenance as well as operation cost. As the machinery gets older it
should be replaced with new one.
Table 3.3 Age of the machine with respect to the type of machine Age in range
FESD of WSIF has different types of machinery with different life periods. Some of the
machineries are operated with difficulties, because of heavy job of farm (land preparation,
cultivation, plantation, harvesting, dozing, loading, and transporting). The operation hour per day
of these machineries exceed the recommended value which results to accelerated depreciation
and, frequent breakage. As indicated above most of the machines are beyond useful life which
takes 17.6% of the total. Therefore, these machines requires disposal. Further more, since no
equipment / machinery is long lasting, a replacement plan of machinery should be implemented
parallel to proper maintenance of machinery at hand.
3.3. Machinery replacement Replacement of machinery in a big enterprise owns a number of machinery is very important to
maximize mass production. The purchase of new machinery results from a need to replace them
if they are inadequate. When the machinery is adequate the reliability increases and delay of field
operation decrease.
Agricultural machineries should be replaced in the following circumstances:
When accidents have damaged the machinery beyond repair.
When field capacity of the machine is inadequate because of the increase in scope of
operation
When a new machine or farm practice makes the old machine obsolete
When performance of new machines in scientifically inferior and.
When anticipated cost for operation exceeds that of replacement cost of the machine.
In WSSF field equipments /machine replacement plan /policy assignment was made. .None
structured interview was made with department head. �Is there any replacement policy of
machinery in your enterprise?� The interviewee response was �no�. Further explanation was
followed. �Why?� The response was that the department needs replacement of machinery and
requested but top management does not seem to accept the idea of replacement.
From the above study one can simply understand that there is no replacement policy or
replacement plan in WSSF FESD. From the result of Table 3.3, 17.6% of the machinery requires
45
replacement. These machineries, most of them are beyond economic useful life. 37.5 % of the
machineries were purchased within 1991-1997 E.C. An average 19% of these are getting ready
for replacement.
Table 3.4 Machine that need replacement, reason for replacement, service life and their number. S. No Machine type Service
life (age) year
Reason for replacement
number Percentage
1 MF >30 Disposable(due to age) 6 18.2%
2 Ford & dozer 20-29 Disposable(due to age) 3 9.1 %
3 MF 12-19 Long service year 15 45.15%
4 MF 5 Due to engine failure 1 3%
5 styer 10 Due to high operation cost
8 24.24%
Total 33 100 %
Figure 3.4 Replacement reason Vs quantity to be replaced in percentage Fig.3.4 replacement reason Vs quantity to be replaced in percentage
46
From Table and figure 3.4 it is clear that 27.3 % of the machines (mostly tractors) are
disposable; they should be sold by scrap. The enterprise didn�t dispose these machineries with
clear disposing policy due to lack of clear disposing plan. 45.45% of the machineries are also
operating with difficulty. The operation, cost and spare consumption increase with age as
machinery gets older. The least percentage of machinery (tractor) should be replaced .due to
failure of engine.
The styer tractors, which were bought in 1992 and had service life of 10 years, could not work
further in WSSF farm because of extremely high operation cost which was unaffordable. It was
observed that they were idle. Therefore, WSSF has to have a replacement plan to sustain
reliability and competency of enterprise. In parallel to implementation of improved maintenance
management, old vehicles should be sold and replaced gradually.
The replacement plan should take in to account the following points;
The useful life of the machinery
The purchased year of the machinery
Current performance of the machinery
Frequency of break down and
Repair and maintenance cost and availability of spare in the market.
The replacement plan should also consider new arrivals of latest machinery, which has high
quality with high efficiency and low maintainability.
3.4. Origin and Makes of Field Equipments (Machinery of WSSF)
There are different types of machinery with different makes and origins are available in WSSF.
All machinery with their origin and make are given in Table 3.5.
47
Table 3.5 Makes and origins of field equipment. 1.No Category Machines type Origin Make 1
Tra
ctor
s
Massey Ferguson
Brazil JV England
-
2 Ford tractors England Ford 3 Fiat new
Holland Italy Fiat
4 Same tractors Italy - 5 Styer tractor Austria Styer 6 Belarus Russia(NTAF) Belarus &
NTAF 7
Hea
vy
equi
pmen
t
Camico loader America Camico 8 Caterpillar America CAT 9 Comatsu loader Japan Comatsu 10 Camico dozer America Camico 11 Case excavator France - 12 Daewoo
excavator South Korea -
13 New Holland dozer
Italy
14 Volvo grader Canada Volvo 15 Back hoe
loader Italy
From the data of Table 3.5, one can see that there are many varieties of machinery with different
origins and makes. They are ten main machinery maker both Tractors and heavy duty
equipments. These machineries have different origin and are made with different quality and
complexity. Each machinery composed of different systems, components which require different
specification to repair (maintain) and operate.
Therefore, more technical repair crews with skilled personnel are required. To maintain these
vehicles it requires many well trained technicians who have theoretical and technical back
ground of machinery with adequate experience, skill full (capable mechanic) and operators are
needed to operate and maintain them.
From the above data, there are about six types of tractors with different origin and make. From
the assessment taken, a single tractor types does have different models, for example, Massey
Fergusson; 178, 290, 398, 4260, 5365, 660, 5340, 465, and 440. Having few trained repair crew
is a system developed similar system components in different equipments (machinery) make and
48
brand are maintained and operated by single technical persons. This means enable the technical
persons who maintained a system of say styer also maintained Belarus tractor. This mechanism
/strategy requires adequate training in order to develop and build capacity of repair crews.
The other alternative is to have many numbers of technical personnel who have experience in
operating existing brand. In this case each machinery has its own respective specialized
technician who can operate and maintain different components and system. In this case it
requires more numbers of technicians. This has side effect, because it requires more number of
technicians. This leads to high total salary which reduces profit of the WSSF and increase
maintenance labor.
From the above assessment FESD have many technicians who have two specialized skills. They
follow either of the strategy but somewhat the second one. The repair crew of heavy equipment
section couldn�t inspect and maintain wheel tractor, even with in the same section. The
technicians don�t have well understanding about their respective section maintenance except few.
This manifests the maintenance strategy of FESD is poor and has no maintenance management.
3.5. Down Time and Availability In agricultural production availability of the machinery or getting ready for the job to be assigned
is very important. In WSSF enterprise if the machineries are not available unlike that of service
bus (transportation bus) the loss of income is not manifested. Ruther the availability of
machinery results to the loss of production of agricultural products. Hence, the availability of
WSSF FESD machineries resulted to loss of yield of sugar and its related products, because of
increase in down time.
Some of the machineries are not available due to:
- Break down of component; In agricultural machinery structure of machinery is
composed and constructed from minute and very simple components. A group of
component makes a system and mechanism. One depends on the other. They perform
their duty with together unlike that of relay race.
49
In WSSF FESD the assessment was made, by conducting none structured interview with section
head on the main cause of unavailability of the machineries. Breakdown was the response of the
interviewee, which takes about 90%. The interview was followed by �what made the
machineries down time so much?� the response was that the great percentage is due to lack of
spare part and the next one is maintenance process. In order to analyze down time and
availability of machinery (tractors and heavy equipment) the data was taken from harvesting
department as per their job such as grab loader, infield transport tractors, and road haulage
tractors.
Seasonal working hours, effective working hours, down hours (time), utilization capacity and
availability of the machinery are thoroughly analyzed in respective of all machinery.
Effective working hours: The hours taken on effective work of machinery and it is expressed as: Effective working hours (x) = total planned working hours down time in hours. 3.1 Down time are categorized into two. These are; non-operational down time which includes idle
time during operators shifting, tea break and urination (getting toilet) and operational down time.
The latter one is the idle time which happened as a result of machinery failure and the time taken
to corrective maintenance.
Utilization capacity: This is expressed in percentage symbolized as X, Y, Z. X-represents
effective working hours in percentage as expressed above and;
100..
.,
hoursworkingtotalhoursworkingeffectiveX 3.2
Y-represents non-operational down time which expressed as:
100.`
``
hoursworkingtotalhoursdownloperationanonY 3.3
50
Z-represents operational down hours (time) which expressed as:
100..
.
hoursworkingtotaldownhoursloperationaZ 3.4
Availability: availability is the ratio of time (hour per day) needed for operating the equipment
to the time actually consumed for operating and expressed as:
Availability=
timeoperatingscheduleddaystimeoperatingactual
..
).(.. 3.5
=timeoperatingscheduled
downtimeunplannedtimeoperatingscheduled..
...
From the above points of view, three machinery categories are taken to analyze all the above.
The researcher summarized all the data of three machineries classifications of 2001/02 or 2008/9
years as shown in table 3.6, 3.7 and 3.8.
Table 3.6a. Grab loader utilization capacity, down time and performance efficiency
Mac
hine
Typ
e
Pla
te N
o
Tot
al c
lock
ho
urs
X Down hours Utilization capacity (%)
Per
form
ance
ef
fici
ency
(%
)
Tot
al w
orki
ng
days
per
se
ason
(23
7)
Ava
lila
bity
%
Y Z X Y Z Cameco 06 2720 1295 1048 377 47.61 38.53 13.86 77.45 115 48
Per.eff.=performance efficiency, T.W.D p.s=total working days per season Table 3.6c Road haulage tractors utilization capacity, down time and performance efficiency
In FSED of WSSF most of maintenance staff of two sections are not young enough, 35.5% of
them are above 45 years old. As one get older body flexibility reduced. Therefore, they couldn�t
take machinery components to desired position like youngster. About 70% of maintenance staffs
are less than 45 years. FESD department should design to build capacity of the youngster in
order to optimize effective, maintenance and things of that older staff and have a plan to replace
those aged staff with young, educated and well trained ones.
The other important things that should not be left with out touching are that, the capacity of the
operators of tractors and heavy equipment because of the fact that, the operators play a great role
in machinery handling. Educated operators perform integral work of operating, condition
monitoring, inspecting, problem identifying, and servicing of the machinery. In WSSF tractors
and heavy equipment operators do not have adequate educational background as shown in Table
3.10.
Table 3.10 Educational level of operators of tractors and heavy machineries. Types of machines
Educational level diploma certificate 12ve &10th
complete 6-9 Below 6 total
Tractors - - 13 25 17 55 Heavy equipment
1 5 30 20 1 57
total 1 5 43 45 18 112 % 0.89% 8.9% 38.4% 40% 16%
57
Figure 3.6 Operators education level Vs quantity Operators who holds diploma are less than 1%. Nowadays machinery technology growing fast,
its system is complicated (from mechanical to electronic). In order to communicate with
machinery system, understand why failure occurs and suggests ways of avoiding failure
occurring and minimize machinery breakdown, it requires educated and well trained operators.
In WSSF as it indicated in the above data the majority (94%) of the operators don�t have
technical back ground. Therefore, WSSF should think of it. Almost all of the operators should
have at least Auto mechanic / Agro mechanic diploma with adequate training on machinery
operations and handling.
3.6.1. Training of Repair Crew A great level of skill can be achieved relatively quickly through formal training. This should not
be limited to the transfer of technical skill and knowledge that are needed for optimal task
performance. WSSF FESD department training of repair and maintenance personnel reduces
wrongly maintaining of machineries. Precision / perfect maintenance denotes a high level of skill
and training of craft. Non-structured interview was made with section head whether training is
provided and has a plan to train technicians. The interviewee response was as follows; �two
years before, training was not inhabited. But after two years numbers of technicians get trained
on different specific areas�. Focus areas on which the training was provided is indicated in the
Table 3.11.
0 10 20 30 40
Percentage value
Diploma
Certificate
12 & 10th complete
6-9 grade
<6 grade
Edu
catio
nal l
evel
58
Table 3.11 Numbers of trainees who involved in specific training. Specific area of training
Number of trainees
year Specific area of training Number of trainees
year
Diesel 16 2001/02 Engine diagnosis and tune up - - Electronic fuel injection(EFI)
7 2001 Machinery hydraulic System /pump
- -
Automotive electricity
4 2001 Air brake - -
Engine rebuilding
- - Work shop and maintenance management
6 2001
Unit-lock brake system
- - Welding 10 2001
Automatic transmission
- - others 3 2001
Training develops confidence of technicians/ maintenance personnel and fills a gap of skill.
From the above data, of the existing machinery staff (Table 3.11) 46 have got training on
different discipline in 2001 E.C. But on same discipline still there is no training provided.
Therefore, in WSSF having few trained repair personnel. If the majorities are not getting
training, it is very difficult to manage and perform maintenance effectively. Selective training
should take place with thorough identification of repair crew who attend, understand and
implement what he /she gets from training. It is observed that from previous trained personnel,
EFI was taken over by repair crew who don�t have well educational background. This results to
waste of time and resource. Therefore, FESD department should differentiate to whom and
which specific training is worth.
3.7. Agricultural Machinery Maintenance Management System In to-day�s Business, the achievement of success usually requires the ability to change and adopt
quickly. Organizational change is seen as a way addressing outdated style of management and
practices. The key to implementing effective organizational change is the wise management of
the process. In WSSF agricultural machinery maintenance management, as one can see from past
brief explanation regarding machinery status, WSSF faces a problem of maintenance
systematization. Many numbers of machineries are not in good status. In agriculture even single
machinery not working has meaningfullness. Many types of machinery are also beyond their
59
useful ages. This resulted to high operating cost, spare part cost and down time cost. Therefore,
they reduce profit and continuous loss that attribute to lack of proper maintenance management
system.
The existing maintenance of WSSF mainly categorized as follows:
Breakdown maintenance: As the name implies, break down maintenance (corrective
maintenance) is the system in which machinery is run until breakdown occurs. This is the most
practiced in WSSF field equipment.
The main causes of practicing breakdown maintenance system in the enterprise are:
Lack of proper maintenance management of machinery
Lack of commitment
Lack of proper training
Lack of upgrading of maintenance crew
Lack of proper skill and knowledge of machinery
Lack of convenient work place
Lack of proper repair and maintenance tool
Shortage of knowledge and skill of operators
The nature of work
Preventive maintenance: PM system is referring to those critical systems which have to reduce
the likely hood of failures of the obsolete minimum. PM includes minor lubrication maintenance
program which interns includes tasks of changing of engine oil, oil filter, oil bath type air
cleaner, final drive oil, front differential oil, gear box oil, oil of steering(power steering),
hydraulic oil, brake oil (brake fluid), coolant and greasing of components. To prevent
breakdown, preventive servicing is carried out with specific objective of detecting / locating
wear areas and ensuring perfect functioning.
In WSSF such type of maintenance is the second inhabited maintenance, the next to breakdown
maintenance. In this case the machineries are not overhauled until break down and manifest
some sign to be break down. In the enterprise there is a plan to change oil but plans are not
implemented.
60
Table 3.12a Types of PM and frequency of change of items. Machinery type MF tractors
Transmission Gear box oil 1200 - 1000 - Differential Final drive oil 1200 - 1200 3456 Brake Brake fluid 2000 - 2000 - Table 3.12d Types of PM and frequency of change of items Machinery type Cameco loader Jon deer Cameco loader Jon deer
Transmission Gear box oil 1000 - 1000 - Differential Final drive oil 1200 1200 Brake Brake fluid 2000 - 2000 - The data were collected from the machinery history record card which includes the time at which
the machinery serviced (oil changed), inspected and every component was repaired and replaced.
Every interval of PM and CM is clearly registered. From these registered data, all the above
actual /serviced time of selected machinery are collected. The most common machinery�s part
which requires PM is selected and the interval (frequency) of time which is recommended by the
manufacturer is thoroughly collected from service manual.
62
The result is as shown in the above Table 3.12; it is clear that PM, proper lubrication/changing
oil for different parts of machine at correct recommended intervals were not taking place in
WSSF. In the contrary, two sections of FESD have machinery service chart which is planned.
Non-structured interview was made with sections head in order to be sure whether the planed
service time was implemented according to manufacturer recommendation. The interviewee
response was as follows; �for machineries which hour meters are functional, suppose engine oil
is changed every two weeks (heavy equipments that work 24 hours per day with three shifts) and
every month for those hour meters are not functional.�
From the above response one can understand that what it was planed and actual one was
different. Even for machinery which works for 24 hours per day, oil should be changed every 12
days and should be the same those hour meter didn�t work. If six days of holy day were
considered from thirty days, 24 effective days could be 480 hours. Therefore, the machinery
could get engine oil in accordance of manufacturers� recommendation.
Planned maintenance condition: in WSSF the existing maintenance that exercised are corrective
(break down maintenance) and few PM (minor lubrication and greasing). Planning is based on
past year experience. In the absence of proper PM. it is difficult to control maintenance
Fig. 3.7b Comparison of salvage value in both methods
From the above figure3.7a, two methods of depreciation cost were determined. The first one is
straight line method which the enterprise has been using and has constant asset value
depreciation while book values of the machinery are reduced with different rate. For the second
case, declining balance method, depreciation cost of machinery is not constant and the
72
machinery depreciated at different amount each year but decimal rate of depreciation remain
constant and has a value of 0.875for heavy equipment and 0.833for tractors when the
machineries are under accelerate depreciation were not considered. Conversely the above value
decimal rates were changed to 0.6 and 0.5 respectively, for heavy equipment and tractors When
machineries are under accelerated depreciation where considered. In case of DBM it is seen from
the figure (3.7a), at the beginning of the year machinery depreciate much more and slowly as it
become aged than SLM. Comparably accumulated depreciation costs of the machineries are high
in DBM. These values are higher under accelerated depreciation (five years and four years for
heavy equipment and tractors respectively). For example CAT D4E SR 92.2% of birr should be
put aside in order to replace the same model of machinery in fourteen (14) years. This is the best
solution to replace machineries at expected optimal life span which reduces maintenance and
repair cost, spare part cost, fuel and lubrication cost which happened with age.
Agricultural machineries which have different horse power but have the same useful life
depreciate at different amount. Therefore, WSSF machinery depreciation cost that has been
collectively registered should be separated. Since same machineries work for limited hours and
some of it engaged with excessive and sever work, depreciation cost should be depends on
amount of hours per years they used. Finally, even though SLM of depreciation is used in WSSF
DBM should be implemented in order to determine the actual value of the machinery at any age.
3.9.4. Capital recovery model for agricultural machinery
As it indicated in the capital recovery section of literature review, capital recovery is the amount
of birr that should have to set aside each year just to replace the value of cost due to depreciation
(loss in value and interest cost of machineries ). Its mathematical model is as follows:
IRRVCRFDTCR -----------------------------------------------------------------------3.6 Capital recovery which is indicated in the section two and capital recovery factors exist in
appendix 3.Therefore, Table 3.18 below shows capital recovery effect with age.
73
Table 3.18 CAT D4E SR capital recovery cost with age.
Age CR Age CR Age CR Age CR Age CR
1 132175 4 424186 7 24008 10 14929 13 9587
2 81498 5 34394 8 20376 11 12687 14 8278
3 54290 6 28537 9 15490 12 11080
Figure 3.8 Capital recovery VS effect of age 3.10. Effect of Age on Insurance IN WSSF insurance was paid for machinery on the basis of on road and off road. Since
enterprise machineries were not participated on public road insurance payment for risk is
independent of public transport like Isuzu, bus etc. Therefore, insurance payment or cost was
Fig.3.9 Insurance cost with respect to age of machinery As it is seen from the Figure 3.9, insurance cost decreases as the machinery gets older. When the
machinery age was new insurance cost was higher. This indicates that the risk to be taken by
insurance company was high. Insurance cost of each machinery was different one from the other.
This mainly depends up on the original value of the machinery, loss in value, and insurance rate.
Comparing two machineries of above Figure (3.9), insurance cost of CAT D4E �SR is higher
than insurance cost of styer tractors.
75
3.11. Housing cost of agricultural machinery
Even though, shelter is one of the most important things to be considered in agricultural
machineries, in WSSF it was observed that many machineries were exposed to Sevier whether
condition (sun, rainy and dust). The enterprise have no any payment (cost) paid for housing.
Whether condition changed physical appearance of machineries when it exposed to sever sun for
a long period of time due to lack of shelter (housing). This also reduced the value of the
machines. Therefore, it is recommended that WSSF would prepare shelter for the sack of proper
care and handling of machineries.
3.12. Agricultural machinery repair and maintenance cost Agricultural machineries i.e. tractors and heavy equipment (articulated tractors) repair and
maintenance are essential; in an effort to guarantee a high standard machine performance and
reliability (a measure of confidence which can be placed on a machinery to complete a planned
duty cycle with component failure).
In WSSF FESD repair and maintenance required cost which includes the cost of break down
which required spare parts and cost of preventive maintenance , which required changing of
same parts of machine like oil filter, air cleaner etc. where under the category of repair and
maintenance cost. In other farm machinery which was owned by private sector and farmers
repair cost include labor cost (wage of drivers and mechanics). But in WSSF labor cost was not
considered as repair and maintenance cost.
In order to study theoretical and actual repair and maintenance cost, eight machineries which
have different class, horse power, service life, and model were used. To determine accumulated
repair and maintenance cost model of ASAE (1983) were used for theoretical ones. The model is
as follows:
76
2
10001
RFn
nnAH
CLPRFARM
3.8
Where: ARM-accumulated repair and maintenance cost
RF1-repair factor one (0.007 and 0.003 for tractors and heavy machineries)
CLP-current list price (purchased price of machineries
AH- Accumulated hours
RF2- repair factor two (2 for both tractors and heavy machineries) The accumulated repair and maintenance costs are based on accumulated repair and maintenance
cost to reduce the availability of the cost due to different in timing of the repairs. The
accumulated use of tractors was given as engine hour which was assumed to be constant in each
year i.e. one thousand per year divided by 1000 , whilst that for machines was given as operating
hours divided by 1000. The accumulated repair and maintenance cost for both theoretical and
actual compared value resulted for each type of machineries were shown in the table (3.20a-h)
and Figure (3.10a-h) below.
Table 3.20a Theoretical and actual repair cost (birr) of styer 9094
Fig 3.11 Yearly accumulated repairs and maintenance cost As it was clearly showed from the e figure 3.11 accumulated repairs and maintenance cost of
heavy machineries i.e. case excavator, cameco loader, and CAT D4E-SR, were higher than
tractors. Even, among heavy equipments mentioned above ARM cost varies with accordance of
machinery capacity (horse power (HP)). For example, case excavator has 188HP, cameco loader
(165HP), and CAT D4E-SR (125HP). Therefore, theoretical yearly accumulated repair and
maintenance cost of case excavator was higher than cameco loader because of variation of horse
power. It was clearly understood that cost of repair and maintenance increased with age. The
power function which have independent variable X, and dependent variable Y, with confidence
level 1, assumed different, one values in some model according to the machinery type and it�s
described better the typical trend in repair and maintenance costs.
ARM cost of styer 9094 theoretical versus actual value was considered. Actual cost was higher
than theoretical until the age six (useful life) then declined radically. With the same fashion
machineries like CAT D4E �SR, Case Excavator, MF 4260,MF 398,FNH 110-90,and Same 130-
DT actual repair and maintenance costs were higher than theoretical except cameco loader which
the actual value was lower than theoretical. In same machineries it was clear that at the older age
the actual costs were reduced than theoretical due to the following possible reasons:
83
- Lack of spare parts
- Being idle of the machineries due to break down for a long time.
- No cost required because of cannibalization of spares from dead machine.
- Late coming of spare parts from abroad due to long chain of procurement process.
Theoretically and actual repair and maintenance costs were Low in the early stage of machineries
life and increased as machinery got older. Generally speaking, ARM costs for heavy equipment
were equal to that of purchased price at less than its useful life. It is also clear that repair costs of
aged machine were higher , the main reasons for these conditions were, inadequate PM which
resulted to series breakdown and which interns resulted to high spare part consumption and being
expensive of cost of repairing.
Hence, it was highly recommended that WSSF should implement PM, proper CM with thorough
source of failure identification, and implement disposing of old machine and then replacing with
new ones.
3.13. FUEL AND OIL COST Among the categories of machineries operating cost Fuel and oil is vital and very important.
Unless fuel is there, for fuel operated, machineries couldn�t operate. Therefore, fuel is food of
machineries (agricultural machineries unlike that of other vehicles do. Oil and lubricant as it was
stated in the literature review section (section two) has a function of lubricating (reducing
friction between moving part) , cleaning dirt impurities either metallic or others, reducing heat
created between moving part as a result of friction and reduce noise.
In WSSF most of the agricultural machineries tractors and heavy equipment) consumed diesel
fuel. Unlike that of ARM cost here also fuel and oil cost was studied. In this study theoretical
and actual fuel and oil consumption was analyzed (correlation analysis ) and compared in order
to determined how much fuel and oil was consumed by the machineries and whether the fuel and
oil costs were much more than theoretical ones. Since oil cost is 10% (ten percent) of fuel cost
theoretical fuel cost was determined by the equation 3.9 and the result was as showed in the
Table 3.22 and Figure 3.12 and appendix 9.
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FC diesel=MAX PTO kw0.223price of dieselhours of use --------------------------3.9
Price of fuel and oil different from time to time and the same is true for hour of use due to fluctuating of operating hours of machinery. Table 3.22 Theoretical, actual and difference of fuel and oil cost Styer tractor
Fig.3.12a Yearly fuel consumption theoretical and actual for Styer tractor (9094)
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Fig.3.12b Yearly oil consumption theoretical and actual for Styer tractor (9094) Table 3.23 Theoretical, actual and difference of fuel and oil cost of CAT D4E -SR
CAT D4E-SR se.year Theoretical FC Actual FC Deference Theoretical oc Actual OC Deference
Fig.3.12c Yearly fuel consumption theoretical and actual of CAT D4E -SR
Fig.3.13 d Yearly oil consumption theoretical and actual CAT D4E -SR From the figure 3.12 and 3.13 above it could be seen than there was a great variation between
theoretical and actual cost fuel and oil. Fuel and oil cost increased with age, as the machinery get
older both fuel and oil costs showed slightly decrement. For this, the following points could be
possible reasons:
Decreasing of operating hours as age increased
Increasing of down time and
Frequency of breakage (failure).
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In general in WSSF machinery fuel and oil cost consumption was high. This resulted reduction
of income of enterprise. WSSF should thoroughly think of it to change and replace aged
machineries with new ones. Not only this but also, if there is no proper PM machinery couldn�t
overhauled at recommended time interval. Hence internal engine parts like cylinder bore, piston,
valve seat etc highly worn out and resulted to high fuel consumption. Due to loss of power
machineries which have low engine performance could consume much fuel and oil. So, WSSF
should provide machinery performance testing instrument in order to control the condition
machinery and fuel consumption. In doing so, top level management should be committed and
give ear to the sound of FESD for the betterment of machinery performance and fuel economy.
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CHAPTER 4
Conclusions and recommendations
4.1. Conclusions Based on the findings in the chapter three, agricultural machineries maintenance management
system in WSSF needs much improvement. Maintenance department (FESD) of this enterprise
should be well equipped with resources to assure the cost effective availability of machineries to
increase productivity of sugar. As it is seen in the section three (chapter three), maintenance has
great impact on the productivity improvement but it has received not much attention in the
WSSF.
In this chapter it is concluded that in WSSF FESD most of the work order generated from break
down of machineries which shows most of the maintenance activities are dominated by
corrective action rather than preventive. One of the main causes of the problems is lack of
effective machinery maintenance management system. This can be generalized by: implementing
proper preventive maintenance, lack of proper machineries replacement and disposal policy
(plan), lack of use of proper technology and adopt appropriate training, shortage of the fittest,
well trained technical professional manpower, adoption of try and error (traditional) maintenance
without know how of equipment system. The existence of high percentage of bad status of
machineries reveals the problem of maintenance management system. Machineries in bad status
are allotted to operation without proper maintenance in order to cover assigned field work. As a
result considerable numbers of agricultural machineries are operating with high fuel cost, oil cost
and spare part cost was investigated. This can be seen easily from the investigation of
agricultural machinery cost. Lack of preventive maintenance, shortage of spare part, absence of
performance measuring instrument, inconvenient work shop place and lack of work shop
facilities and improper data recording and some are evidenced to poor maintenance management.
Thus, this paper finds out the causes of frequent break down and ways to minimize them in order
to increase machineries availability and reducing down time. Machineries daily operating hours
without considerable rest are longer, which affects viscosity of engine oil and faster wear of
machinery components. It is concluded that machineries average operating hours are longer. This
resulted in accelerated depreciation of machineries and shortens the economic life than expected.
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Higher frequency of repair and maintenance caused deterioration of the machineries from time to
time. Thus some of the machineries don�t give expected service after repaired finally WSSF are
on the expansion program. Wake Tiyo and Dodota sugar cane wide farm yards are the parts of
this. It requires many in numbers of agricultural machineries and well being huge enterprise.
Being competent is a matter of survival. If the machineries could not be handled and maintained
cane yard couldn�t be cultivated, planted, and harvested and cane couldn�t be supplied to the
factory as a row product then cane sugar production will be in question.
Having all these problems above it is very difficult to proceed and even it leads the factory to
shut down unless radical change will be brought on maintenance management system of the
machinery.
4.2 Recommendations In order to solve the existing problem of maintenance management of WSSF FESD the
following recommendations are forwarded based on the study.
1. Maintenance should be an enterprise program of action as one of the strategy in being
productive and competitive in production of sugar and related product and FESD should
be emphasized as it is one of the main areas of the sugar productivity optimization.
Therefore, implementing preventive maintenance which is recommended in this paper
should be implemented effectively for better achievement:
Professional persons who were well trained with Automotive Technology and
Agro mechanics (agricultural machinery engineering) should be assigned for
proper scheduling of preventive maintenance.
Strict follow up of scheduled time interval should be done by assigning
professional.
2. Maintenance awareness and commitment should be created in the enterprise starting from
top management in the organization up to lower level of maintenance staff through
training and seminar. Conduct open discussion for top level management, maintenance
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department head, sections head about the existing problem in maintenance. FESD should
present the revealing the major problems and related issues should be discussed.
3. WSSF enterprise should encourage their machinery operators to become familiar with the
machineries they operate. Intensive training should be provided for them to acquire: the
ability to understand machineries function and systems; and the ability to detect causes of
abnormality when happened; the ability to monitoring the condition of machinery; the
ability to detect machineries problem and make correction, repair and maintaining; the
ability to handle and manage machineries. Very low grade level operators should be left
with mechanically controlled machineries. Furthermore, well qualified operators at least
who have diploma in Auto mechanics and Agro mechanics should be employed and on
job training should be provided for the sake of best care and reducing of frequent failure
advanced (electronic) machineries.
4. Empowering maintenance staff (mechanics) through intensive training should be given
due attention and conducted in sustainable manner to maximize the availability of
machineries in eliminating improper repair. This training should be only for those who
have qualification and have technical background to rebuild their capacity. Since
uneducated maintenance men are there, it is highly recommended that they should be
assigned for the other job where they fit or WSSF should let them to upgrade their
education to technical.
5. The machineries should be kept clean, maintenance areas should be kept clean too.
Because most of the abnormality develops from dirt machineries.
6. Daily, weekly and monthly check list should be available for every machinery to be
inspected by the operators and mechanics. The frequency of inspection should consider
history and the status of machineries. Hence WSSF FESD should have at list four (4)
planners for both sections who can manage this task to have effective PM schedule.
7. Those machineries which have long service life and beyond use full life (old
machineries) should be disposed and replaced with new one. Old machineries resulted to
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high frequency of breakdown, high down time, high spare part cost, fuel cost and oil cost.
Therefore, WSSF should have machinery disposal and replacement police in order to
maintain WSSF production on reliable condition.
8. FESD work shop doesn�t have arrangement and work bench on which repair is to be
done. There was no machineries performance measuring instrument which enabled to
identify machineries internal condition. Lack of these equipment lead the machineries
unable to detect low engine performance. Hence high operating costs are evidenced.
Therefore, it is highly recommended that WSSF should fulfill work shop facilities and
maintenance equipment for better maintenance activities.
9. Annual operating hours of machineries are longer than recommended values. This effect
puts machineries under accelerated depreciation and reduces useful life with less than
half percent. Therefore, WSSF should increase the number of machineries to implement
shift working and elongate optimal use full life.
10. Finally, no one works for himself in WSSF, each and every worker endeavors are for
better achievement of enterprise�s goal and put it in better position. Therefore, top level
management should accept and implement the requisitions of all important, equipment
and facilities addressed from FESD to be fulfilled in the maintenance work shop.
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Appendix -1 Repair and maintenance factor for field operation of Agricultural machineries Agricultural Machinery
EUL Estimated Useful Life
Total life cost% Repair factors RF1 RF2
2WD &stationery 12000 100 0.007 2 4WD & crawler 16000 80 0.003 2 Source: American society of agricultural engineers standards, (1993) Appendix -2 Accumulated repair costs as a percentage of new list prices Types of machinery