Plant managers are saving pennies on the dollar to cut back on fundamental cleaning steps and other basic preventive maintenance, meanwhile missing out on perhaps millions of dollars that could be saved through reduced failure rates. Despite the analysis, managers all too often still make the decision not to implement the basics, according to Steve Murray, director of reliability systems for ABB.
Murray spoke Thursday morning at this week's ABB Automation and Power World event in Orlando about the need to analyze past failures for a more successful future. "I don't know how those maintenance guys are surviving. It's amazing the lack of preventive maintenance in place," he said privately after his presentation. "They're just not doing it. So the maintenance guys spend all their time running around troubleshooting."
Murray even went so far as to say that he thinks such neglect is often responsible for decisions to move production from the U.S. or Europe to cheaper locations such as China or Mexico. Eventually, the company manager gets tired of the failure rates and expenses, and decides to move the factories offshore.
What makes this trend particularly disturbing is that there are a great number of expensive failures that are easily preventable when the correct steps are taken. Murray pointed to a recent case in which his team analyzed failures on a case packer that was being used to package cans for a major cola manufacturer. The packer was responsible for taking the filled can, introducing the packaging, then marrying the two together. It operated at very high speeds (nominal capacity was 30 cartons per minute), with a lot of electronic components involved in the process.
But the case packer saw a high rate of failure, Murray said. For one year, lost product was 166,500 cases. One process alone, in which the sides of the boxes are brought up and folded over, accounted for 63,000 lost cases and $441,000 in lost revenues.
"This was all really simple stuff; nothing really jumps out," Murray added, noting that in some cases workers simply were not properly skilled or trained. "A lot of these jobs are simple like this. Plant management knows it needs to be done. They know it's not being done. But they're still not doing it."
But taking these steps pays off in the end. In the case packer situation, after ABB's recommendations were implemented, the number of cases increased by 32,000 per year, putting $224,000 more revenue in the company's pocket. In addition, maintenance took less time, lowering the maintenance cost per case.
"Everything that we do with reliability in industry has to have a dollar value. Otherwise there's no point in doing it," Murray said, excepting employee safety and the environment aspects.
Another often neglected measure is the relationship between overall equipment effectiveness (OEE) and profitability. In a pulp and paper mill, OEE was analyzed at 60%, and the mill's profit was about $11.3 million. By raising the performance of OEE's three components—availability, performance and quality yield—by just a few percentage points, and raising overall OEE to 70%, profit nearly doubled, to more than $20.6 million.
This kind of improvement is more important now than ever. "A lot of industries, especially in the U.S., are downsizing or moving operations overseas," Murray said. "They're reducing the number of plants, so the existing plants have to be able to produce more." This scenario makes machine availability a significant factor, he added.
Failures occur for a number of reasons, including environmental, maintenance and operations errors, overstress on the machines, poor design, temperature, variations, and wear over time. "In automotive and all industries we go to, errors are one of the biggest problems," Murray noted. The automotive industry also saw more than its share of failures in the late 1980s because of poor design of robots, which were being hydraulically operated. The food industry is often plagued with small, high-frequency type failures, he added.
Managing failures requires developing an asset hierarchy, and evaluating each level of the hierarchy, Murray said. His team tries to push preventive maintenance in order to start catching potential failures before they become catastrophic. But that doesn't mean that procedures have to be implemented for every component of every machine. "One of the things we always stress is you can't cover every asset in your plant," Murray said. "So what you have to do is focus your attention on the heaviest hitters; the ones that will hurt you the most." He added later, "There's always a financial or safety reason why we're doing something. If it doesn't pan out, we generally leave it."
Ultimately, though, failures really shouldn't happen at all, according to Murray. "Unacceptable failures are the result of unmanaged risks," he said. "Most failures can be prevented or at least mitigated."
