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When creating your plant strategy, you should be asking yourself the following questions: are my maintenance and reliability efforts providing a tangible and consistent competitive advantage?
Is the refinery or chemical plant team fully aligned behind breakthrough improvement? Is there a clear method for deploying breakthrough improvement?
A new application of lean thinking is sparking new efforts at leading people in the oil & gas and chemical industries. Better understanding of the applications and new adaptation of the lean mindset in continuous flow environments is making breakthrough improvements possible in traditional maintenance and reliability.
Implementing lean maintenance and reliability methods can be that key differentiator in your asset management strategy to achieve higher levels of performance and enable you to outpace the competition. A younger workforce, hungry for learning and open to innovative methods, is ready to engage with and explore new non-digitized and digitized tools and is leading the way as advocates for changing the status quo.
What is asset management?
In Asset Management Excellence, Andrew K.S. Jardine defines asset management excellence as “when a plant performance is up to its design standards, and equipment operates smoothly when needed. It is maintenance costs tracking on budget, with reasonable capital investment. It is high service levels and fast inventory turnover. It is motivated, competent trades.” Simply put, asset management excellence occurs when maintenance and operations follow industry best-in-class guidelines.
Plants that leverage lean thinking concepts are improving their asset performance faster and achieving longer performance intervals. There are two key principles of lean thinking.
The first principle is that you should not accept a defect at the next step. When operators hold themselves accountable for equipment care and operating correctly, they take complete ownership. They catch their own mistakes and learn from them with the help of others.
The second principle is about flow. Flowing the right inspections, procedures, materials, preventive maintenance to the equipment, right work to the equipment and units at the right time. Do you know if your reliability team is focused on the right things? Are your teams inspecting vendor materials before using them?
For the last 20 years, ARGO-EFESO has been both a leader and practitioner in the application of lean methods in multiple industries, including oil & gas and chemicals. ARGO-EFESO has been able to synthesize and adjust lean practices from automotive back in the 1990’s to capital intensive process industries. The result has been successful applications for specific purposes and objectives in each industry.
Over 20 years ago, basic lean methodologies were introduced to the oil & gas industry, including 5S, visual management, and a few others. Global integrated majors like Shell, BP and Chevron launched extensive lean, as well as Six Sigma, programs with varying levels of success. Many of these pioneering programs were met with some level of disappointment when bottom-line results fell short of expectations and levels of buy-in within middle management and the front lines dwindled.
In this new application of lean, the focus is more on people and less on tools to better align the organization. Focusing on structured problem-solving, eliminating waste and empowering the workforce is allowing for a more effective application of tools.
Improvement teams are also reaching further into the front lines, armed with essential waste elimination approaches like Leader Standard Work, daily performance tracking, active problem solving, flow and pull that provide real impact on productivity and throughput. In a recent example, a 200-person maintenance team increased the number of work orders processed per day by 20 percent after introducing two new approaches in their daily routine: daily visual performance metrics and visual multi-craft scheduling.
At every stage of the performance spectrum, maintenance teams can gain a significant competitive advantage by applying these techniques. Whether it is by improving engagement with the frontlines or achieving higher levels of work order productivity, these methods can prove to be game-changing for plants that are looking to re-energize their asset management strategy.
Plants undergoing this transformation, and achieving first and second quartile results, are focusing their efforts in four key lean pillars:
- Removing wastes and constraints for craftsmen and operators to complete work
- Enabling leaders to lead improvements with visual management
- Implementing visual scheduling and pull to increase workflow velocity
- Increasing collaboration and ownership between operations and maintenance
1. Removing barriers and constraints for employees and contractors
Our research and experience show that one of every three work orders that maintenance crafts attempt to start working on every morning results in a constraint where they have wasted time.
Operations are frequently blamed for maintenance constraints, but often they are not aware if or when maintenance is planning to show up. They are often having to choose between running the unit and supporting maintenance.
Teams are empowered to eliminate these constraints by implementing lean thinking concepts of daily visual management, quality at the source, structured problem-solving, and 5S.
Top performing companies benefit from a tightly run maintenance workflow that has a high responsive capability for equipment upkeep, while being able to find the right balance between preventive and corrective work. These organizations are also quite skilled at tracking and resolving constraints to execution and selecting the right front-line metrics while also making a concerted effort in coaching front-line leaders to install effective daily performance dialogues that sets the right expectations for work execution.
2. Leading improvements with visual management
ARGO-EFESO’s experience shows that many plants are experiencing a leadership gap in their leaders at all levels. People are getting promoted based on their technical skills and time on the job and not their ability to lead teams. Additionally, the burden of managing the day-to-day administrative duties and meetings has increased. Our studies show that only 20 percent of front-line supervisors are actually leading, while 80 percent are managing or expediting the day-to-day activities. Our definition of leading is when leaders are actively coaching, mentoring, and providing constructive feedback to their teams to help them achieve their daily targets and goals. Combined with effective visual management to make the team accountable and to demonstrate progress and successes the process becomes very effective.
When it comes to leading continuous improvement, our study shows that less than 5 percent of front-line supervisors are leading their teams to eliminate wastes, improve processes, or innovate work practices. Anchoring leader behaviors in enabling supervisors to apply leadership skills to achieve breakthrough improvement will result in the growth of leaders and workforce performance. Once a supervisor has led their team to successfully sustain, they increase their credibility and ability to influence for future change. We believe in the 70/20/10 model of learning where 70 percent of learning is achieved through doing, 20 percent is from being coached and 10 percent is from formal in-class training.
3. Implementing pull
The challenge today with the traditional maintenance workflow model is four-fold.
The first challenge is a published prioritized schedule on Thursday for the following week does not keep up with the plants changing priorities and has already changed by Monday. Our studies show that only 20 percent of what was scheduled on Thursday was executed by the following Wednesday.
The second challenge is that with the “great resignation” and a lower tenured workforce, resource utilization and productivity has stalled. Many plants are adding resources to manage risk because maintenance is not able to keep up with the backlog.
The third challenge is that the maintenance workflow does not leverage the comparative advantage of Maintenance Supervisors. CMMS tells them what to work on each day and does not include their knowledge or input. Their comparative advantage is to assign work to their workforce based on resource availability and their experience to optimize throughput.
The fourth and final challenge is that traditional scheduling utilizes a push system where work orders are attempted to be pushed through the workflow. People attempt to execute the work provided to them and have no input on the work to be done. A push system promotes expediting and reprioritization of work, sub-optimizing resources, and workflow.
The alternative is a pull system. The main advantage of a pull system is that work orders are controlled according to the capacity of the downstream work to prevent the waste of over-production of work orders before they are executable. Operations and maintenance leaders meet daily to review the following:
- Maintenance provides status of what they completed from the prior days plan
- Maintenance supervisors pull work for the next day from the ready to execute queue and self-optimizes the work orders to maximize productivity. Maintenance supervisors have a comparative advantage in that they know their teams’ capabilities and the equipment, and they can see pull work in the same area in the plant. As the work is pulled, it is confirmed with operations.
- Once the next day’s plan is complete, operations notifies the operators of equipment that is to be ready for maintenance in the morning, and the warehouse is notified of material that is to be ready.
- Operations then pull work orders from ready-backlog and replenishes the ready to execute queue.
- Lastly, operations pulls work orders from their backlog and replenishes the planners pull queue to identify what planners should plan next.
The resulting output is amazing. Communication and collaboration increase, work flows faster, and there are less constraints in the field. The average cycle time to complete a work order from notification to work completion improves by 30 to 50 percent. Work orders completed versus work orders created goes from negative to positive, and backlog is reduced. Risk is reduced as the most important work is being completed according to the target completion times.
Even though it is well accepted that both maintenance and operations need to be active players in the daily management of workflow for effective execution, in many organizations, this harmonic balance for the ownership of equipment and accountability of execution is less that desired, resulting in a poorly managed backlog, increasing risk, and higher repair costs. A pull system allows for maximum transparency of the workflow and a laser focused effort to optimize flow and resources.
4. Increase communication and collaboration
We find that organizations have different operating models related to which group or individuals drive the workflow execution. There are some where planning and scheduling areas set the daily priorities, in others, it is the maintenance department, in others it is operations, and in other cases it is done in a survival mode, hour-by-hour, according to the emergencies and events of the day or week.
Every plant wants their employees to act and perform like a team. Many may say they have organized their maintenance into area-based teams or unit-based teams versus centralized maintenance organizations. We think team-based maintenance maximizes communication and collaboration. Our definition of team-based maintenance takes area-based maintenance and adds lean thinking.
The definition of team-based maintenance: An organized team accountable to the customer (i.e equipment and operations) to flow maintenance work to completion where the core team members can self-coordinate and self-optimize to achieve both flow and resource efficiency. What this means is that the customer sees unplanned downtime decrease (flow efficiency) and maintenance crafts are being utilized optimally (resource efficiency).
Team based maintenance value proposition
Team-based maintenance focuses on increasing communication and collaboration to reduce/eliminate waste and white spaces. The example above shows when one task is complete it is visual for the next trade to start work (example: once scaffold is complete, insulation can begin, and when insulation is complete, pipefitters can begin work.)
Another benefit of team-based maintenance is optimizing resources within each team. Each team has core resources that are subject matter experts in the equipment. There are also pooled resources that are developing their skills that can flex between teams. Just like the lean thinking concept of cellular work design, when extra resources are needed the team can increase in size by adding pooled resources and reduce resources when the demand decreases.
The benefits have proven to be tremendous. We have seen where workflow is moving at such a pace that backlog is depleted so they can start to focus more on value improvement projects that improve reliability. We have found that 80 percent of reliability issues are better solved within the team communication and coordination of operations and maintenance, allowing reliability to focus on reducing risk and threats.
Just like in team sports, the teams that have accountability to each other win championships. In team-based maintenance, the use of a ready-for-maintenance operator is closely connected to the operators running the unit and can provide real-time feedback when it comes to constraints, defects and running the equipment correctly.
“It’s amazing to me the incredible results that can be achieved by empowering your team to act and applying these concepts” - Brook Vickery, Vice President and Manufacturing Manager at Flint Hills Resources
Refinery leadership teams are being challenged to further improve their asset availability and productivity levels while finding new ways to improve and sustain performance in an environment of rapidly changing workforce and skill levels. These teams are having a difficult time finding ways to engage and energize team members, as well as measuring and tracking this journey towards excellence while buried in a mountain of data from CMMS systems.
Our unique lean approach seeks to start from the basics of waste elimination in the workflow while gradually transitioning to a more advanced methods to manage flow and resources. The secret is to empower the front-line teams to determine a realistic method to measure their performance, to find waste and to learn to implement daily structured problem-solving. A new wave of lean that stresses people, not tools, and drives accountability and flow from the people that do the work is particularly powerful as part of this imperative to optimize asset management.
To learn more about how ARGO-EFESO can help your plant implement lean maintenance and reliability methods, contact us or call 312-543-1026. To learn more about ARGO-EFESO’s services visit ArgoConsulting.com.