1. Corporate Operational Reliability Reliability Center, Inc. www.Reliability.com © Reliability Center, Inc. 1985-2002

2. Who is Reliability Center, Inc.? Began in 1972 as Allied Chemical’s Corporate R & D Reliability Center Split off as an independent organization in 1985 Pioneered the industry standard, “Reliability Approach to Quality and Productivity” Developers of the award winning PROACT® Software Suite including the New LEAP™ Opportunity Analysis Software Providing flexibilty through common Reliability assistance, processes and training platforms worldwide © Reliability Center, Inc. 1985-2002

3. A Glimpse at Our Customer Base Air Liquide AK Steel BP/AMOCO Chevron/Phillips Coors Brewing Dominion Virginia Power Dupont Eastman Chemicals Ecopetrol Eli Lilly International Paper Lafarge Lyondell-Citgo M&M Mars PECOM (Perez Companc) PDVSA PEMEX PREMCOR Shell Canada Syncrude Canada Chevron - Texaco Whirlpool © Reliability Center, Inc. 1985-2002

4. Reliability Program Initiatives © Reliability Center, Inc. 1985-2002

5. Eliminating the risk of recurrence of undesirable outcomes Here’s how you start... PROACT ® System © Reliability Center, Inc. 1985-2002

6. Calculate the "Gap” using FMEA PRECISION Status Quo Continuous Improvement Human Roots Addressed (Disciplinary Action) Physical Roots Addressed Untrusting workforce Latent Roots Addressed Problems © Reliability Center, Inc. 1985-2002

7. Your targets are now highlighted… This is your money leak! Your targets are now highlighted… This is your money leak! 0% 10% 20% 30% 40% 50% 60% % of Loss Failure Events 80% of loss PSM - Problem Solving Methods RCA - Root Cause Analysis 20% of loss © Reliability Center, Inc. 1985-2002

8. From your “Significant Few” findings split the events to be eliminated by the relevant RCI program From your “Significant Few” findings split the events to be eliminated by the relevant RCI program Events Principal Analyst Required Involves All Levels Part Time/Full Time Root Cause Analysis Extremely Disciplined/ High Attention to Detail Significant Few - 80% of Losses Hourly/Supervisory Level Part Time Problem Solving Skills Less Attention to Detail Random Many - 20% of Losses 100% Coverage RCA Methods PSM Advanced For Facilitators - Major Events Problem Solving Methods - Minor Events © Reliability Center, Inc. 1985-2002

9. The RCI Two-Track Approach Root Cause Analysis Methods © (RCA) Advanced Facilitation Methods for Major chronic event elimination Problem Solving Methods© (PSM) Chronic event elimination at the supervisory and front line level The Reliability Performance Process© (TRPP) Managing Reliability Systems for Executives © Reliability Center, Inc. 1985-2002

10. The Supporting Software for RCI’s Reliability Systems LEAP ™ Software Opportunity Analysis (OA) Process + PROACT ® Software Root Cause Analysis (RCA) = Best Practices and Lessons Learned Database 1 2 3 4 5 6 7 8 9 10 Priority Work Identified 20% © Reliability Center, Inc. 1985-2002

11. PROACT ® Enterprise Version Produces Quick and Quantum ROI’s Establishes Knowledge Management System for Corporation to Share Successful Logic Trees Used to Eliminate Failures Develops World Class Analytical Skills Results in Drastic Cost Savings and Improved Performance Ensures Regulatory Compliance Significantly Reduces Cycle Times to Conduct Root Cause Analyses Benefits: © Reliability Center, Inc. 1985-2002

12. The Basis for your Knowledge Management & Best Practices Transfer Network Tie-in to your existing CMMS, ERP, EAM systems The Basis for your Knowledge Management & Best Practices Transfer Network Tie-in to your existing CMMS, ERP, EAM systems Desktop Version Single-User VS Enterprise Version Network (SQL/ORACLE) Brazil Argentina Mexico Server Venezuela Enterprise Version Enterprise Version Enterprise Version © Reliability Center, Inc. 1985-2002

13. Unfortunately, most companies do not allow the results they achieve to be published…but these did! “Root Cause Analysis: Improving Performance for Bottom-Line Results” “Root Cause Analysis: Improving Performance for Bottom-Line Results” Latino & Latino, 2002, CRC Press, Boca Raton, FL, ISBN 0-8493-1318-x (See Case Studies in Chapter 11) Eastman Chemical (World Hqtr.) 50% Reduction in Customer Complaints Weyerhaeuser 25% Increase in Prod. Capacity LYONDELL-CITGO 17,900% ROI (ISPAT) Inland Steel 4,000% ROI Eastman Chemical (TED) 3,200% ROI Alabama Power 3,125% ROI © Reliability Center, Inc. 1985-2002

14. Maintain Conduct RCA on High Return Event With Trained Team Demonstrate ROI’s To Fund RCA Effort Correlate RCA Objectives with Corporate Key Performance Indicators Establish Performance Target Set Up Management Support Structure Train & Roll Out To Analysts Prove Effectiveness Keep It Up How to start and fund your PROACT® Corporate Reliability Process Pilot RCA Provide ROI Establish KPI’s Develop GAP Set Up Support Roll Out Track/ Measure © Reliability Center, Inc. 1985-2002

15. Calculate your company’s savings ROI Now for the fun part! Click the ROI button below and put in your numbers (not ours.) You will be surprised at the reachable savings still to be had within your company. (Click Here) © Reliability Center, Inc. 1985-2002

16. Summary The average analysis from start to implementation using the PROACT ® System is 5 weeks - 5 months. RCI offers quick results generated from within your company, not by outside consultants. No massive capital investments or major man hour allocations are required. In our experience, the elimination of one major failure utilizing RCI’s PROACT ® process will fund ALL of your Reliability Programs. WARNING! The worst case scenario we see day after day is training of a few individuals and expecting corporate to move from Reactive to Precision Based Reliability. We invite you to visit our web site at www.reliability.com. There is a gold mine of information for you. If you are serious about a corporate change in your organization regarding improvements to your bottom-line we look forward to hearing from you. Contact Norman Haggie at 804-458-0645 x311 or nhaggie@reliability.com. © Reliability Center, Inc. 1985-2002

17. Thank you for your attention! Reliability Center, Inc. www.Reliability.com 804-458-0645 804-452-2119 [fax] info@reliability.com 501 Westover Ave. Hopewell, Virginia 23860 © Reliability Center, Inc. 1985-2002