RCM – The Elements Most Organisations Miss by Peter Ormond

The Elements RCM is not just an analysis tool – it is a whole way of life. RCM is often implemented as a ‘project’ but should be implemented as the basis of ‘continuous improvement’. RCM can be the catalyst to move Maintenance from being a Cost Centre to being a Profit Centre. Deciding ‘what’ to do is a good start, but calculating ‘how often’ to do it is just as important. Developing and cost-justifying alternatives can provide massive savings. Any maintenance plan will fall down if not supported by the ‘right’ spare parts.

RCM as a Support Column Workforce - Product CMMS – Production Control Systems RCMRCM Spares Optimisation TPM – TQM – Six Sigma Strategic Plan

Maintenance Philosophies Breakdown Maintenance Industrial Revolution Preventive or Change-out Maintenance Second World War Predictive or Condition Based Maintenance Mid ’60’s Reliability Centred Maintenance Mid ’80’s

BHP’s Experience Steel Industry World Wide Review Man-hours per Liquid Tonne of Steel Four Best Practice Organisations Biggest difference – Maintenance treated as a PROFIT CENTRE BHP was managing Maintenance as COST CENTRE

Maint $Maint $/ Tonne Cost Centre/Profit Centre Quantity of Maintenance Over- Maintained Under- Maintained Too Much Expenditure Too Little Expenditure X X Cost Centre Based Profit Centre Based Correct Expenditure Correct Amount of Maint.

Change Required Although individually capable, people in groups do not always share alignment to a common business purpose: Differing Opinions on: Relevance Importance Differing levels of: Knowledge Understanding Different: Business Needs & Objectives (KPI’s) Unwittingly – they pull in different directions….. Different: Interpretations of what is needed Differing Values: (Assumptions about what is true) Differing Beliefs: (Assumptions about what is desirable and worth striving for)

Change Achievable The desired outcome of education is to align everyone’s understanding: Net change for effort expended can be greatly improved…

Who is Most Important? Senior Management Decree & Direct Middle Management Interpret & Instruct Lower Management Interpret & Supervise Operators & Maintainers Make the Product

The Supportive Organisation Senior Management Direct & SUPPORT Lower Management Interpret & SUPPORT Middle Management Interpret & SUPPORT Operators & Maintainers Make the Product

BHP Steel’s Results Achieved 50% reduction in 6 years Pointed to two factors having greater impact than anticipated: Re-Education of all employees into common understanding of Maintenance Implementation of RCM (RCM Turbo)

How does it all fit together?  Business Plan  Plant Strategy  Operating requirements  Inventory plant items  Life Plans for critical plant items (RCM analysis)  Document Retrieval System Work instructions CMMS Task lists Maintenance plans Work orders

RCM-Turbo The Versatile Tool Equip Codes Fail Analysis Task Analysis Opt Freq Grp Tasks Resource Bal Scheduling KPI Review Reactive Maintenance Systems Maturity Proactive Improvement Steps

RCM-Turbo The Versatile Tool Equip Codes Fail Analysis Task Analysis Opt Freq Grp Tasks Resource Bal Scheduling KPI Review CMMS Improvement Steps Reactive Maintenance Systems Maturity Proactive

RCM-Turbo The Versatile Tool Equip Codes Fail Analysis Task Analysis Opt Freq Grp Tasks Resource Bal Scheduling KPI Review RCM CMMS Improvement Steps Reactive Maintenance Systems Maturity Proactive

RCM-Turbo The Versatile Tool Equip Codes Fail Analysis Task Analysis Opt Freq Grp Tasks Resource Bal Scheduling KPI Review RCM RCM-Turbo CMMS Improvement Steps Reactive Maintenance Systems Maturity Proactive

Cost of Inspection Cost of Failure Total Annual Business Cost of Maint. Optimum Frequency Time MTBF FTM - Optimum Frequency based on Probability of Failure in MTBF Frequency Optimisation

70% Confidence non- failure 98% Confidence non- failure Warning Time P F1F1 F

Cost of Inspection Cost of Failure Total Annual Business Cost of Maint. Optimum Frequency Time MTBF CBM - Optimum Frequency based on Confidence of non Failure in Warning Time Warning Time Cost of Planned Repair Frequency Optimisation

Frequency Optimisation Graph

Benefits Obtained from Frequency Optimisation Many Tasks Increase in Frequency – Increasing Reliability Many Tasks Reduce in Frequency – Reduced Costs without Compromising Reliability Average Cost Reduction 10% – 15% Assists ‘What If..?’ Scenario Testing Justification of Maintenance Decisions

Implementation Steps Group Sessions Include Facilitators, Maintenance & Operators Assess Criticality, Boundaries, Process Functions, Functional Failures One-On-One Interviews Facilitators & Maintenance Failure Mode & Effects Review Sessions Buy-In & Sign-Off

Implementation Plan 6 – 8 weeks initial reviews 1 – 2 day reviews Criticality Time

Benefits of RCM Changing Organisations to Profit Centre from Cost Centre Maintenance A Methodology to apply Business Decision to Maintenance Planning Supports all Current Maintenance Techniques Consistent with and sub-part of TQM/TPM/ Six Sigma, etc.

Inventory Control Move to an Optimized level of spares from a F.I.S.H. inventory system which stands for: First In Still Here !

The Reality of the Challenge Maintenance wants more of everything! “I’ll keep the plant running, but only if I can have all the spares I think I need!” Doubling levels is easy to justify when the lack of a spare has caused delays! Nobody ever wants to halve levels!

Further Challenging Issues The justification to reduce is the 25% per year holding costs. One justification to increase is the £25 per line to process a PO. Other factors include Lead Time, Usage Rate and required Service Factor. But all standard supply algorithms can only work on Fast Moving Items.

Why Use An “ Expert System ” ? Typical “ Human ” Decision Process: Limited # Of Variables Considered Inconsistent (Often Emotional) Process Decisions Based On “ Gut ” Feel Or Experience Seldom Documented Lead Time Cost Failure Pattern Usage Rate

SOS - An Expert System Computerized Decision Support Process  Yields Decisions That Are: More Valid Easier To Make Faster Documented Repeatable Cost Usage History Probability Planned Use Criticality Failure Pattern Source Where Used Down Time Predictability Duty Common Parts Risk Alternatives Lead Time

How Do Expert Systems Work? Strategic’s “Expert” Methodology: Structured Question with Multiple Choice Answers “ Optimum ” Decisions With Minimum Effort “ Knowledge Based ” With Strong Maintenance Orientation Situation Appraisal & Fuzzy Logic Techniques To “ Smooth ” Results

Business Based Decisions Item Criticality Determine Minimum Stock Level Economics Determine Maximum Stock Level Common Platform Documented Decision Priority MinimizeAvoid Scrap High MediumLow

Benefits Of SOS Inventory and Risk Reduction Inventory and Risk Reduction Current Stocking Levels Optimum Stocking Levels Time Risk

The Elements RCM is not just an analysis tool – it is a whole way of life. RCM is often implemented as a ‘project’ but should be implemented as the basis of ‘continuous improvement’. RCM can be the catalyst to move Maintenance from being a Cost Centre to being a Profit Centre. Deciding ‘what’ to do is a good start, but calculating ‘how often’ to do it is just as important. Developing and cost-justifying alternatives can provide massive savings. Any maintenance plan will fall down if not supported by the ‘right’ spare parts.