Big data and MPM: A new...Preventive Maintenance Reliability Centered Maintenance Computerized Maintenance Management Systems (CMMS) Total Productive Maintenance Condition-Based Maintenance

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Coimbra, 4th – 5th September, 2014

Big data and MPM: A new maintenance era powered

by ISO 55000

Professor Diego Galar

Lulea University of technology

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Agenda

Asset management and the value of Maintenance

The need of MPM

The need of a global picture for maintenance decisions

Context driven maintenance: The logic path

The new paradigm for asset lifecycle

PBC and maintenance as a service

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Importance of Maintenance is Still Neglected

• Each management will tell you that maintenance is important: “Without maintenance we will have no production and no safe working facilities”

• However, in economic downtimes maintenance is primarily seen as cost center

• Maintenance manager is not able to show the added value of maintenance....

• ... because he/she does not speak the language of the board

• With all consequences as such

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What is the real value of themaintenance?

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It’s not just about the asset …

..and services delivered to the customer.

it’s about what the asset

does…

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What is Asset Management?• Management Process Designed to Optimizes Facility Performance

• Determines Asset contribution to meeting Business Objectives

• Analyzes Asset performance at levels consistent with value (contribution)

• Applies resources to assets in support of optimal performance for meeting business objectiveso Engineering, Construction, Purchasing, Inventory,

Operations, Maintenance

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Defining Asset Management• “an on‐going process which enables managers to optimize the investment in their assets resulting in reduced operating & maintenance costs and improved business sustainability”

• AM is the alignment of a utility’s business processes to provide for a more efficient and effective operation & maintenance.

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Why Asset Management?

• Only way to fully meet high level of operational performance objectives at the lowest cost to the facility

• Enables Risk Management for consistent performance

• Provides complete objective data for process improvement

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How does an organization benefit from Asset Management when it has maintenance

management?

• Provides Management with a full spectrum view of cost and risk associated with assets

• Enables Management to apply the correct resources at the right time

• Provides data that validates the management decisions and work processes

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Maintenance data

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Asset Life Cycle

DESIGN

FABRICATECONSTRUCT

OPERATEMAINTAIN

REPLACERETIRE

Specification

Requirements

Procure

Install

Modify

Rebuild

Monitor

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Function & Performance

Application Environment

RAMS, LCC & Risk analysis

Maintenance program

IntegratedMaintenanceSolutions

Cost Effective Product

Development & Life Cycle

Management

Design phase

Safety, Environment, Sustainability, ROI

Interests are different….

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Describing System state & behavior

Explaining

Predicting

Controlling

IntegratedMaintenanceSolutions

Effective Asset &

Production Management

Diagnosis

WHY?ConditionMonitoring

WHAT?

Prognosis

When?

How?

Operation phase

Safety, Environment, Sustainability, ROI

Interests are different….Maintenance Perform

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The mine, example of contradictions…. Manufacturers versus end users

Footer

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Evolution of Maintenance Management

• Prior to 50th: Necessary evil• 50‐70 : Preventive maintenance • 70th : Life cycle costing, RCM and

Productive maintenance.• 80 : TPM an RCM• 90th‐date: Strategic view of maintenance

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The Maintenance System

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Asset ManagementGoals and Objectives

• Provide effective monitoring capabilities which allow decision makers to manage identified opportunities

• Prevent value destruction by stabilizing and positioning the organization for integration and implementation

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Common Maintenance Management mistakes that don´t create value

• Regulatory Issue

• Information Technology Issue

• Preventive Maintenance Issue

• Who is Responsible

• One‐time Event

• If You Ignore it – It Will go Away

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Mistake 1 – Regulatory Issue

• If you comply with the regulations you are practicing good asset management.

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Mistake 2 – Information Technology

• IT is the answero Software – it is just a matter of having the right software

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Mistake 3 – Preventive Maintenance

• A preventive maintenance program will take care of your asset management needs

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Mistake 4 –Responsibility

• Asset management is the responsibility of:o Engineers

o Accountants

o IT

o Management

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Mistake 5 – One‐time Event

• An asset management report is the solution!

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Mistake 6 – Ignore it

• Asset management is just another fad – it too will pass

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Maintenance Performance Monitoring plays a key role in asset management

• Management Challengeso How to see the ‘big picture’?

o How to link day to day actions to strategy?

o How to easily communicate performance to the Board?

Could you expand on “Oops, looks like something bad happened”

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Aggregation is needed

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Performance Management

• Immediate and Comprehensive way to manage and maximize consistent improvementwithin the organization,

• Linking day‐to‐day actions with the overall vision, mission, and strategy of the Utility

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Maintenance as a System

MaintenanceSystem

MaintenanceSystem

Inputs OutputsFeedback

Enterprise System

Environment

MaterialsLabourSparesToolsMoneyTechnologyInformationFacilities

CapacityQualitySystem ImageMaintainabilityAvailabilityReliability SafetyCost

AdjustCalibrateInspectRepair

Replace

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• Industry is evolving to address complex, highly specialized asset management

• Automation Performance Services takes a growing trend and applies it to the highly specialized area of industrial automation

• Delivers automation excellence that drives business performance while optimizing risk

• Pay for Asset Performance and Usage

Performance driven industry…the future

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• Definitiono CBM is a set of maintenance actions based on real‐time or near‐real time assessment of equipment condition

• Purpose

o“The purpose of CBM strategy is to perform maintenance only when there is objective evidence of local need

Condition Based Maintenance

It is easy to protect the asset and no the function…..

What about global need?

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But...What is Risk in Asset Management?

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Run to failureInspection

Preventive Maintenance

Reliability Centered Maintenance

Computerized Maintenance Management Systems (CMMS)

Total Productive Maintenance

Condition-Based Maintenance (CBM)

1930 1950 1990 2000

Prognostics & Health Management (PHM)

Evolving Maintenance Strategies

Context Driven Maintenance

Risk Based Maintenance (RBM)

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The current value of maintenance

Engineering or Management?

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PBC, the logic way…. versus other formulas

• Lump sum ‐ payment based on a single price for the total work

• Admeasure ‐ payment based on quantity of completed work and tendered rates (bill of quantities)

• Performance ‐ payment based on performance (or results) achieved

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Risk Allocation Between Client & Contractor

• Lump sum, admeasure and performance contracts: contractor bears much of the risk

• Cost‐reimbursable contracts: client bears the main risk

• Currently most companies favor admeasure contracts (fear to PBC)

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For PBC: Contractors are Free to Decide

• What to do

• When to do

• How to do

• Where to do

• To do physical works themselves, or subcontract to others (some restrictions may exist)

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Maintenance as a service

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Maintenance, present everywhere and disconnected….

Raw Material Transportation Storage Manufacturing Storage Distribution Retail

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PBC involves Supply Chain Management (SCM)

Raw Material Transportation Storage Manufacturing Storage Distribution Retail

• Focus on process, not function (Process reliability)• Focus on integration and coordination of all organizations

Involves Coordinated Management of Logistics Processes

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Total Cost of Ownership in the new maintenance paradigm

By using a structured, diagnostic approach to calculate TCO, fleet managers will have the information needed to make difficult changes

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TCO is an easy‐to‐understand, but tricky to calculate, number that fleet managers can use to compare costs within their fleet, identify trends, and make replacement decisions

Key TCO Drivers

TCO can be offset or reduced by:

• Optimizing vehicle lifecycles (in years)

• Decreasing individual vehicle utilization

• Increasing disposal reimbursements

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Optimization of lifecycle? Is it possible?

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New asset strategy

Planned obsolescence comes into the picture

‐ Design for failure‐ Early replacement‐ Warranty extension

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THE CHALLENGE

CALCULATION OF MAINTENANCE VALUE

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The Renewing Business NetworkThe increased outsourcingof maintenance serviceshas created a need to makeboth the value and profitability of maintenance moretransparent at the business network level.

Customer

MaintenanceCompa

ny

EquipmentProvider

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Standards help to identify and model the maintenance value

Valuet Replacemen Assets

Cost eMaintenanc Total1E

Costation transformProduction

Cost eMaintenanc Total4 E

Output ofQuantity

Cost eMaintenanc Total3 E

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Be careful with some indicators….Maybe they were never designed to show the real

maintenance value

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In summay:Advantages of PBC

• Reduced administration: less effort to measure works

• Client focus: pay on the basis of user‐related performance indicators

• More responsibility to contractors stimulates initiative and innovation

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Disadvantages of PBC

• Longer tendering period

• Uncertainty of long term relationship

• Lack of some (or unclearly specified) performance standards and level of service

• Possible unfair competition for smaller contractors

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Thing that must be clear in your PBC

• Be careful with incentives for the contractors to perform well and avoid increased maintenance costs in future in order to comply with performance indicators defined in the contract (asset may be degraded)

• Decide the lifespam of your asset and type of maintenance (overhauls or CBM)

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Regarding the contracting

• Ensure solid and credible financing of contract during the entire contract period

• Build in a Dispute Resolution Mechanism

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An finally go ahead with PBC

• Define clear and simple performance standards and measures before advertising bids

• Include only “maintainable” assets unless overhauls are included…

• Have consistent documents and requirements

• Do not try to impose too many risks on the contractor

• Be aware of the risk chain of your business

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Coimbra, 4th – 5th September, 2014Maintenance Perform

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Información de Contacto

Professor Diego Galar Pascual, PhDwww.ltu.se

Email: [email protected]éfono: +46 920492437

Lulea University of Technology97187, Lulea Sweden

Big data and MPM: A new...Preventive Maintenance Reliability Centered Maintenance Computerized Maintenance Management Systems (CMMS) Total Productive Maintenance Condition-Based Maintenance

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