Case Studies in Maintenance and Reliability: A Wealth of Best Practices. V. Narayan

of work. It is managed within defined parameters, e.g., ceilings on total volume and residence time for each item.

      •The current week’s work plan is firm. It consists of proactive work and all high-priority emergent work which was known before issuing the plan the week before.

      •Work on this plan will be displaced by new emergent work only if the team decides that it has high enough priority. Otherwise it will be put in the repository.

      •The following weeks’ work plans consist of proactive work and appropriately scheduled emergent work from the repository.

      •After execution, every week’s plan is reviewed; learning is extracted and applied in the future.

      Principle 5—Define the Shutdown Maintenance Process

Figure 5.2 Shutdown Maintenance Process

      We defined the shutdown maintenance process using the diagram illustrated in Figure 5.2.

      The main features of this process are:

      •Well ahead of time, management installs a team leader and identifies future team members of all disciplines. Their roles are clearly defined. The premise of the shutdown is clearly established, from which the objectives may be derived.

      •Timely compilation of the work list, including a review of process issues, e.g., catalyst regeneration.

      •The team challenges all items in the work list using a risk-based approach. They freeze the revised work list and, thus, the scope.

      •Any new work proposed after the freeze has to surmount a tough business hurdle.

      •The team identifies contractors at this stage.

      •The planner uses a multidiscipline-integrated planning, scheduling, and resource optimization of all work in the scope (people, equipment, cost, etc.). This results in one plan for all disciplines, optimized for all resources. Contractors are fully involved in this work.

      •Use of brain-storming exercises to identify alternative solutions for expensive items of work at this stage, e.g., scaffolding rationalization.

      •Actual shutdown execution is a seamless and integrated process from the time the feed is cut off until the time finished products start to flow to storage. During this entire period, the team leader is solely in charge and manages daily coordination meetings, daily safety supervisors meeting, completion of inspection before the halfway point, and daily update of plan. The team leader applies a tough business challenge for emergent work.

      •Top management including the GM frequently visit the site, show visible support, and get a first-hand “feel”.

      •The team leader carries out a post-implementation review and feedback (improvement cycle), soon after completion of shutdown.

      I published the new maintenance philosophy document, Principle 1 described above, within three weeks of arrival. The remaining four principles, which were based on this principle, followed in the next few weeks.

      5.9 Results

      Within a year, the new ways of working were firmly in place. The mind-set and expectations of staff were radically different from those seen just a year earlier. After three years, using an international four-quartile benchmarking scale, the maintenance performance of the refinery moved up two quartiles, and thus became a leader.

      5.10 Learning Points

      1.Importance and Power of Benchmarking

      With the help of benchmarking, the new GM quickly came to realize that one area with poor performance was maintenance. The benchmarks he used were developed by an international petroleum company, also one of the partners in this refinery (see Chapter 8 for additional details). These were used to compare the performance of its numerous child companies all over the world. That maintenance performance needed improvement will be clear from the following popular benchmarking factors:

      • Annualized Total Maintenance Cost (TMC) as % of Total Operating Cost, excluding fuel.

      In a petroleum refinery, most cost elements are independent of the activity level, i.e., the throughput. These cost elements add together to account for the fixed cost. Of the elements which are dependent on activity level—accounting for the variable cost—the cost of fuel is the most significant. Others, e.g., process chemicals, have a negligible effect in the context of this benchmark. Therefore, if the cost of fuel is removed from the total, the proportion that various cost groups such as production, maintenance, technology, and administration form of the total is nearly constant from year to year. The proportion of the annualized TMC should be about 30%. The GM noticed that in this refinery it was about 45%.

      • Annualized TMC as % of Asset Replacement Value.

      As the replacement value of an asset varies with inflation and other market forces, so does the cost of maintaining that asset. This ratio, therefore, is quite a good indicator of maintenance effectiveness. When the new GM arrived, this ratio for the refinery was 2.5% as against 1.4% for an average performer and 0.9% for the best performers.

      2.Maintaining Focus

      Keeping an enterprise or an initiative in focus is a major factor for its success and good performance.

      It has been experienced over and over again that an initiative or enterprise will fail unless it is kept in focus by people responsible for it. This focus is often expressed as ‘keeping your eye on the ball.’ Focus is a top-down thing. Unless the top management sends clear signals of interest, the organization below will not respond. In this refinery, the glamorous thing was to build new plants and then commission them, thus being in the limelight. The mundane task of maintaining the existing and the newly-acquired assets was out of focus—and rightly so because there was no reward for good performance in maintenance.

      The lack of focus on maintenance was not hard to recognize. I asked the refinery economist to relate the direct and indirect effect of maintenance on the refinery bottom line. When I revealed these numbers to the shop floor level, maintenance suddenly acquired a new glamorous high profile. This also led to maintainers talking to operators on equal terms.

      3.Providing Leadership and Expertise

      It is not enough to have a group of competent people in an enterprise. Their efforts will be wasted unless there is a leader with relevant expertise who can give direction to their individual efforts. High-visibility direct contact with the rank and file, easy accessibility to them, and leading from the front speed up the rate of progress towards the goal. Daily walks through the plant, shop-floor meetings, an open-door policy, and one-on-one debates with the rank and file help re-establish the focus.

      5.11 Principles

      Leaders need to understand the true state of affairs and, when necessary, have the courage and energy to take corrective actions. Lack of focus is a fairly common problem and sometimes happens over time due to the plethora of emerging ideas, projects, or external pressures.

      The first step is to take stock and unambiguously define the purpose of the enterprise and the philosophy guiding its conduct. Good communication will ensure that every one concerned with the enterprise understands the issues.

Chapter 6

       Applying Business Best Practices

      … focus, alignment, and speedy implementation help to reap benefits

       There are costs and risks to a program of action, but they are far less than the long-range risks and costs of comfortable inaction.

       John F. Kennedy.