It’s not surprising that poor asset performance hampers overall business performance. When there are unplanned shutdowns or assets that perform below their expected levels, profit margins suffer pushing operational excellence further and further away.
No organization can expect to achieve Operational Excellence when the assets they need to produce the goods they sell are operating at subpar levels, unexpectedly shutting down, or in decline.
Many asset-intensive organizations are still using reactive (break-fix) maintenance plans to manage their production assets. Not only does reactive maintenance cost businesses through increased downtime and lost production, but unplanned shutdowns or failures of these assets can lead to environmental health and safety incidents.
Fortunately, in the last few years, asset-heavy organizations are shifting from reactive maintenance to predictive maintenance (prevent and eliminate unplanned failures) as part of an Asset Performance Management strategy.
What is an APM Strategy?
APM is the overall management of physical assets within a plant that directly impact operations. APM is proven to reduce unplanned downtime, increase asset availability, decrease maintenance costs, and reduce the risk of failure for assets that are most critical to operations.
Driven by analytics, APM uses digital technology to gain a comprehensive view of production, asset performance and product quality. However, an effective APM strategy is more than installing sensors or technology solutions that monitor your systems and assets for the purpose of collecting data. APM is most transformative when an organization’s human assets understand:
• what the data is telling them
• how to diagnose areas of concern
• how to predict events likely to occur or recur
• the corrective measures to reduce the likelihood of recurrence
This is the sweet spot for an effective APM strategy.
What’s keeping you from getting in front of asset performance issues?
Today, fewer than 5% of companies have achieved an APM program that helps to optimize maintenance, operation and asset investment decisions to achieve financial results.
You may be questioning why your APM technology program is falling short. When it comes to asset performance management, many companies naturally focus on the technical details of data collection and processing. While new technologies like IoT devices, embedded sensors and standardized telemetry capabilities can offer real-time insights into operations, the data is only useful when your human assets know how to interpret it, and when your people are working in an environment that allows for collaboration and information-sharing across the business.
The cracks where potential for APM success is escaping
Siloed departments and lack of ownership – APM is often considered to be in the realm of maintenance, with responsibilities relegated to maintenance and operations. In fact, APM-related issues can transcend across other functional silos such as Process/Technical, HSE and Materials, Corrosion and Inspection. Depending on the circumstances, accountability or ownership of a particular issue may be vague. Fixing one problem may not take associated risks into consideration, or how the overall process will be impacted. And if department goals are conflicting, they may actually be working against each other.
Lack of visibility of critical knowledge – Many long-term workers have learned asset maintenance strategies over the years, but have never documented or shared them. People with relevant information must be encouraged and enabled with ways to share it or this tacit knowledge will leave an organization when the employee does.
Pockets of excellence, but lack of uniformity – Groups of people in your organization may have strong management practices in place: documentation exists, measures are in place, and accountability is enforced. But there are no opportunities for sharing best practices or following a consistent, coordinated approach across the entire organization. Localized efforts in one department may even negatively impact other parts of the business.
Data overload and what to do with it – At its core, APM is about the collection of data. But as more and more data floods in, the ability to use the results can be lost. Data must change behavior, or data collection and analytics are a waste of time. When people know and understand how to interpret the data to provide meaningful, actionable insights, data can be used to improve operational performance.
Reliance on reactive problem solving – When problems arise, people tend to jump into firefighting mode – the urgent need to fix a problem as quickly as possible, so things can return to their normal rhythm. The same band-aid approach may be used each time the problem repeats itself – never actually addressing the cause. When reactive behaviors prevail, recurring problems go unresolved, quality suffers and equipment failures become more frequent.
RCA – The cornerstone of APM success
Root cause analysis (RCA) is typically thought of as a way to find the cause of a problem or an issue so it can be fixed. While RCA helps to diagnose the cause of an incident so reactive action can be taken, it can be very useful for predictive action – developing and implementing solutions that prevent a fault or a problem from occurring repeatedly in the future.
Every asset or system you have is designed and configured to operate in a specific way, and to serve an intended purpose. Your organization depends on these assets to be reliable and stable with predictable performance. And while an unexpected breakdown is costly and inconvenient – there’s no greater opportunity to use learnings to anticipate and prevent larger, more expensive breakdowns in the future.
What is your downtime telling you?
The immediacy of issue resolution puts problem solvers in the prime position to analyze the potential for related problems to become crisis situations. RCA can interpret the monitoring and telemetry data that your systems are generating to identify areas of concern, which can then be diagnosed to understand where the underlying issues are coming from. By paying attention to the signals coming from the environment during issue resolution, proactive measures can turn similar problems into non-events.
Proactive RCA efforts should focus on:
• Availability – Are your assets consistently available and performing at levels that can serve their intended purposes? Do you encounter frequent outages, changes in performance/throughput or do the assets require frequent reboots and configuration tuning? Once set up, a stable operational asset should be able to run continuously for a period of time at a consistent level of performance without manual intervention.
• Reliability – Can users and operations processes depend on the asset to perform its intended functions reliably to avoid causing operational interruption? While availability deals with the system being up and running, reliability focuses on the asset serving its intended purpose. That requires that the features and dependent services be operating successfully as well.
RCA looks at how the overall environment is configured, all system and business-related events taking place, and changes introduced that may impact the asset, like configuration changes or upgrades.
The result of the analysis is a clear understanding of what is causing the issue so informed decisions can be made to avoid future incidents. Preventive actions can take many forms—from preventative maintenance and tune-ups to specific process changes that optimize operations.
Thinking beyond the fix
A crucial part of comprehensive RCA efforts is to “think beyond the fix” (TBF) to extend your thinking into the preventive mode rather than remaining in reactive mode.
RCA considers the environment, the system and events as cog and wheels working together – understanding that an action in one area triggers an action in another. The key questions to ask when using TBF thinking are:
What other damage could this cause create?
Where else could this cause create problems?
What caused the cause?
What identical things need the same fix?
What problems could this fix cause?
Information that comes out of this line of questioning will allow you to expand your preventive action thinking and avoid the critical issues that defaulted to RCA mode in the first place.
Using critical thinking to interpret data
Generating the right set of data about your processes and systems can give you the early warning needed to avoid future problems. However, this data and ability to automatically identify and respond to problems still needs to be paired with sharp critical thinking and complex problem-solving capabilities within your workforce.
This is often a wrinkle in the process. Teams have the data but lack the skills to effectively use it to resolve issues and maximize profitability. Here are four ways to use critical thinking to uncover context within the data.
1. Bring together representatives from all departments. A diverse problem-solving team knows how to access and use information within their areas of expertise. Including someone from quality, production, operations and maintenance vastly expands the knowledge in the room and brings together disparate sources of data that are commonly siloed across various departments. With everyone focused on resolving an issue, a diversity of perspectives and information can eliminate roadblocks, build consensus and focus on solving the issue at hand.
2. Need more data? Keep looking. Eventually problem solvers reach a point when information needed is not at hand and may or may not exist. Don’t stop there. Within all relevant sources of data, there may be raw data and analytics in need of compilation or there may be someone outside the team who has access to answers. First understand the intent of your question and why you are looking for a particular piece of information. This will allow you to come up with alternative ways to find that data. Then, assign a team member to seek access to the information and involve more resources. Remember it is not about gathering all of the data, it is about gathering the right data.
3. Understand your problem before seeking a solution. A problem is a problem when the solution is not evident. To consider solutions efficiently, the problem must be defined with specificity. The more specific the definition, the easier it is to find the data that leads to resolution. One way to define a problem is to use the Five Whys. Describe the situation, ask and answer “Why?” until the answer is, “I don’t know.” The Five Whys helps to get to the heart of the problem. The way we are defining the word “problem”: it is a deviation from the expected performance where the cause is unknown. And, in order to take meaningful action, you need to know the cause. The Five Whys approach is a great tool to get you to this cause unknown point where more robust problem solving takes over.
4. Build context. Context is the key to revealing fully nuanced, complete information. By integrating “thick data” (huge amounts of data) rather than a sampling of information, data analytics can create more accurate context and a complete picture. It’s the same with problem solving. Often, it becomes an iterative exercise with the relevant data becoming apparent only after you have answered initial questions that allow you to identify what you don’t know, but need to know.
Building a Collaborative Culture of Continuous Improvement
The need for a collaborative, organization-wide process is commonly cited as a fundamental challenge to improving asset management. Technological problems can be solved, but the key to continuous improvement lies with your people.
All organizational functions have objectives and targets they need to reach. How do you ensure that ultimately goals are achieved with aligned approaches, despite the different targets of each department?
Identify – Evaluate where you are in your APM journey. Look for opportunities and gaps within your organization through the lenses of your people, processes and tools. What is having the biggest impact on your organization? Examine your current state and your desired future state. Through this process, critical action areas can be identified and prioritized.
Assess – Set strategic and tactical plans. Assess what needs to be done to close the gaps and result in quick wins – for example, “a lack of co-operation between maintenance and operations, and no clear divide in responsibilities.” Work on improving troubleshooting processes and removing departmental ambiguity. Establish situations in which one department is the default for asset management. Focus on data transparency through the organization so optimal decisions can be made.
Implement – Equip your people with critical thinking and problem-solving skills using root cause analysis. Train them to think and act independently and employ visual thinking to communicate problems and issues in clear, understandable ways. Develop a knowledge repository where asset knowledge and trouble-shooting content can be stored and accessed across the organization. Create internal APM experts to guide, coach and ensure sustained behavioral changes.
Quantify – Measure the operational impacts of your APM strategy. Metrics may include:
• Reduction of production costs and quality loss
• Reduction in down time
• Reduction in replacement parts costs
• Longer mean time between failures (MTBF)
• Failures are predicted, with no unanticipated failures of critical equipment
• Mean time to repair (MTTR) is reduced
• Increase in first pass yield
• Increase in overall throughput
• Employees make sound maintenance and operational decisions
• Ineffective maintenance activities are reduced or eliminated
• Proper maintenance events are performed at the right time
• Correlation between operational and maintenance history and asset life
• Operational performance and maintenance data shared resulting in aligned goals
• Better manuals, procedures and training for critical equipment
Your people will drive your APM strategy – not your data.
Asset-intensive organizations are increasingly relying on APM and predictive analytics to help maximize the performance of the assets that run their business. While technologies offer real benefits in the form of data-driven insights, keep in mind that equipment reliability is a technical as well as a human challenge.
The journey to mature APM success must include the people side of your organization – with a framework that encourages collaboration between departments, use of critical thinking and problem- solving skills, and aligned efforts across the organization – resulting in smarter decisions, lower maintenance costs and higher asset reliability.
Let us help you achieve operational excellence in your organization. Reach out to us and lets start the discussion.
Contributors to this white paper
Chris Green
North American Lead – Operational Excellence, Kepner-Tregoe
Ingrid Dueck
Consultant, Kepner-Tregoe
Amelia Lee
Consultant, Kepner-Tregoe