Suncor Energy reported Monday it has completed maintenance on Upgrader 2 (U2) at its oil sands facility located north of Fort McMurray, Alta., and that the upgrader has now returned to normal operations.

The upgrader was safely taken offline in March due to a fractionator performance issue. Suncor does not anticipate this will result in a change to its annual production guidance.

According to news reports, Syncrude Canada also had one of its upgrading units, the 100,000 bpd Coker 8-1, down for extended maintenance and there was no word yet on whether it had restarted.
www.suncor.com

Over the past three years, Barrick Gold Corp. has been on a maintenance improvement journey, taking important steps to improve its maintenance function. Here’s why and how.

Barrick is the world’s largest gold mining company by production and reserves. It’s a Canadian company with its head office in Toronto, but Barrick is truly a global company with 26 operating mines and numerous development projects and exploration activities worldwide. Its vision is to be the world’s best gold company by finding, acquiring, developing and producing quality reserves in a safe, profitable and socially responsible manner.

The Maintenance Challenge
It should not surprise you to learn that the mining industry is capital intensive. Indeed, Barrick has billions of dollars invested in plants, equipment and infrastructure. One large haul truck may cost more than $2.5 million, and Barrick has hundreds of them. A single large tire can cost $60,000. We are currently investing about $7 billion to build two large new mines: Pueblo Viejo in the Dominican Republic and Pascua-Lama on the border of Chile and Argentina. All of this plant and equipment requires on-going maintenance for peak performance and maximum life, so maintenance is one of the largest costs in our business.

The mining environment is rugged and it’s tough on equipment. Blasting and digging generates a lot of dust. Operating conditions include temperatures ranging from –40°C in the mountains of South America to as high as 50°C at some of our Australian sites. Some operations are at high altitude — up to 5,500 metres above sea level at our South American operations. In all of these conditions, our equipment works hard. These conditions can affect reliability and performance. In every sense of the word, our maintenance challenge is significant!

Good maintenance makes good business sense because it improves safety and equipment reliability, and that improves production uptime. Planned and regular preventive maintenance ensures safe and smooth running of equipment and processes.

Lack of proper maintenance can result in bad outcomes in terms of safety, production and cost. When we experienced a number of mobile-equipment fires, we initiated a major review of our maintenance function and found areas for improvement. Our analysis showed a high level of unplanned maintenance, so we recognized we could reduce our costs with better planning and scheduling. We saw the need to improve training and career opportunities for our maintenance staff to improve their effectiveness and encourage retention.

Barrick, like many other mining companies, has often grown by acquisition. The result was a variety of approaches and practices at various sites. We realized we needed a common set of standards and systems across the company, as well as a standard set of key performance indicators to evaluate and manage performance. We needed to focus on reliability and develop a true strategic asset management approach.

Starting the Journey
So we set out on a maintenance journey. The first step was recognizing these issues and acknowledging the value of the maintenance function. We mapped out the existing maintenance situation at our sites, documenting lists of people and structures.

We brought together the maintenance leaders from each region for a global meeting to start the conversation about how to improve the maintenance function. It was an opportunity to understand their issues and challenges — and to offer support to help drive improvement. Involving everyone up front was critical for gaining momentum for this program.

At the same time, we presented the case to the senior leadership team. Several key points gained their support. Poor maintenance was creating safety issues, such as equipment fires. Poor maintenance was causing breakdowns that interfere with production. Our current spend on maintenance was high because of the percentage of unplanned work. With improved practices, we could actually reduce the overall annual maintenance costs over time. The leaders saw the value and made maintenance improvement a priority for the company.

We developed an asset management policy in consultation with our regional maintenance leadership team. It states our fundamental principles about management of our assets from design to disposal. The policy conveys our belief that all equipment failures are preventable. It also commits the organization to develop clear policies and standards and to provide leadership for implementing the asset management strategy across the organization. It’s signed by our senior executives. This one-page document became our mandate. We distributed it widely, and it’s posted at Barrick sites and regional offices worldwide.

Working with the regional teams, we developed our maintenance management system in late 2009. It sets out the company’s minimum standards for maintenance across the organization. It’s a very useful guide that helps maintenance leaders put the right plans and structures in place to achieve good results. It sets standards for nine key areas, including leadership, structure, strategic planning, performance measurement and others. The system also recognizes the interdependence with other functional areas, such as production and supply chain.

To help everyone work in a standardized way, we needed to implement standardized business processes. We worked closely with our supply chain colleagues to define and enhance our business processes. Then, we needed a single computerized maintenance management system (CMMS) platform — which at Barrick is the Oracle eAM.

Tools and Training
Fundamental to a good business process is the fact that everyone must know and understand their job responsibilities. We reviewed our organizational structure to align the roles and responsibilities across corporate, business regions and sites. Our maintenance management system outlines the recommended organizational structures to support maintenance. We identified gaps and filled those positions.

As we proceeded, we recognized we had a shortage of mechanical and electrical engineers. But just adding more people was not enough. We also needed to make sure their roles were clearly defined and that we had a support structure of training and career development to help them succeed.

We prepared information and tools to help them do their jobs. We developed a set of maintenance standards that cover most of the key topics. These are intended to answer the question, “What does the organization expect from us?” We also developed a series of guidance notes on how to implement important tasks. These are intended to answer the question, “How do I do that?”

We organized all these standards, templates, reference materials, and tools into a Maintenance Knowledge Centre on our company’s intranet site. We included a global contact list, which makes it easy for them to contact each other to discuss common problems and share information. We intend to build on this sense of community through collaborative forums in the future.

The centre includes a set of computer-based training modules on a range of topics, including basic mining, diesel engines, financial analysis, project management and more. We worked closely with some of our OEMs to ensure the training relates specifically to the equipment we use. The modules follow the curriculum for our in-house graduate engineering training program. Each module has a questionnaire that must be completed by the graduate program participants. We track the traffic to see which documents and tools people use. This information helps us enhance the site. All employees, not just maintenance staff, have access to the site and the modules so they can increase their knowledge of maintenance and engineering.

Marketing Our Maintenance
To promote maintenance across the organization, we worked with the our communications department to produce professional materials and to announce our progress through features stories on the intranet and in the corporate global newsletter. These efforts helped us gain and sustain momentum for the program.

The publicity has raised the profile of the maintenance function within Barrick and has helped our maintenance employees feel recognized and appreciated.

We Are Now Here
Members of the global maintenance team have now visited every Barrick site to conduct a site review. During these visits, we assess the site’s activities against the requirements set out in the maintenance management system. We discuss the results with the site managers and develop plans to address any gaps. We don’t approach this like an audit; we approach it like a coaching session. We are there to help the site improve. We monitor the results and document the improvement actions.

We have just commenced our second round of site reviews, and we will track the progress since the first review. The results so far have been encouraging as sites show considerable commitment and improvement. In addition, we recently surveyed maintenance leaders across the organization, and we will use their feedback to further improve.

We’ve come a long way on our maintenance improvement journey. We have a lot of the key foundation elements in place — policy, systems, standards, site reviews, training and other processes. All of our business regions and sites have plans in place to drive maintenance improvement.

The challenge now is to keep the momentum going. It takes time and hard work to implement change in any large organization. We want maintenance improvement to become part of Barrick’s culture. This will ensure work will continue and be independent of individuals.

We are pleased at the progress we have made so far and still have some distance to travel — but we know we’re headed in the right direction and we’re determined to get there. Our success will be rewarding for everyone in the maintenance function, and it will create significant value for our company.

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Robert Cronin is the senior manager of maintenance at Barrick Gold Corp. in Toronto. For more information, visit www.barrick.com.

Shop floors, petroleum refineries, and fabricating centres in Alberta were a bit busier this January, starting off the New Year on the right foot.

Shipments of manufactured goods rose to $6.4 billion in the first month of the year, a slight uptick of 0.9 per cent over the previous month. But compared to January of 2011, manufacturing activity in the province was higher by 16.5 per cent, according to Statistics Canada.

Nationally, manufacturing sales moved in the opposite direction, slipping 0.9 per cent to $49.6 billion, the second decrease in seven months. The decrease partly reflected a drop in production in the aerospace product and parts industry, primary metals, machinery and other transportation equipment industries.

Alberta’s manufacturing activity is concentrated in those industries that provide either inputs into the energy sector (eg. steel pipe, specialized equipment, etc.), or outputs (refined petroleum and chemicals). As a result, overall manufacturing values in the province tend to move in tandem with oil and gas activity. The occasional shut-down of a refinery or upgrader due to maintenance can interrupt that trend.

Provincial manufacturing also includes food packaging and processing (especially meat products) and forestry products such as lumber and pulp and paper, both of which have fallen in recent quarters.

The level of manufacturing shipments remains a small amount below the record highs set in early 2008. Still, the trend over the past two years has been clearly towards an expansion in overall sales. That bodes well for Alberta’s economy going into 2012.

From: www.troymedia.com

An experienced forklift operator should already be familiar with the ins and outs of forklift safety. Most Canadian provinces have regulations that specify only a "competent person" may operate a forklift, in an attempt to ensure operators know the proper safety procedures before getting in the truck.

There is more to forklift safety than just safe operation— there is also general safety inspection and maintenance. In Ontario, for example, the Occupational Health and Safety Act requires the employer, as the owner of the equipment, to ensure periodic examination of powered lift trucks. The Act recommends owners fulfill this requirement by establishing procedures for regular inspection and repair at the workplace.

What do you do as the plant manager or maintenance manager if this responsibility falls into your lap? The Canadian Centre for Occupational Health and Safety (CCOHS) has some safety tips that might help.

DOs

• Do permit only qualified people to service and maintain equipment.
• Do wear proper personal protective equipment. For example, wear goggles when grinding, or wear face shields, aprons and rubber boots when handling lead-acid batteries or working around battery-charging equipment.
• Do disconnect all batteries before doing any work.
• Do block the forklift securely when removing wheels.
• Do support the forklift hood in upright posi- tion or remove entirely before beginning work.
• Do keep the work area clean and well-lit.
• Do clean spilled oil or hydraulic fluid immediately.
• Do remove all tools and parts before starting the engine.
• Do avoid contact with battery terminals with hoisting chains, tools and metal objects.
• Do attach a chain hoist to the counterweight before removing it from a forklift.
• Do use magnet particle testing to inspect all hoses, couplings, fittings and connections to the cylinders in the main mast assembly and the tilt control system.

DON'Ts

• DON'T leave parts, creepers, cans, tools or other obstacles around.
• DON'T lift beyond your capacity. Use hoist or leverage tools to lift or move heavy parts or equipment.
• DON'T smoke, weld or light a match around refueling and battery-charging areas.
• DON'T start a forklift if its is on a lift hoist or wheel stands.
• DON'T work on forklift attachments unless you are familiar with their operation.
• DON'T work beneath elevated forklifts or forks unless they are securely supported by approved blocks.
• DON'T run propane, gas or diesel forklifts in unventilated areas.
• DON'T start or drive a forklift before knowing why it is for repairs.
• DON'T perform any repairs without checking the operator's daily checklist.
• DON'T forget to cover the battery top with an insulating material.

Remember the "fork" in forklift
Forklift maintenance doesn't end with the truck itself. The Canadian Centre for Occupational Health and Safety (CCOHS) recommends both daily and six month inspections of the forks on a forklift truck.

CCOHS says that operators should make a daily visual inspection of forks during the pre-start-up check, especially looking for permanent distortions and cracks. A trained individual should be called in every six months to check for cracks and distortion. Some of the most important points to cover in a six month inspection include:

• Check fork blades for wear. CCOHS says forks are constantly subjected to abrasion by things such as concrete floors and steel shelving. Abrasion can reduce the thickness of a fork until it cannot lift loads up to the designed capacity.
• Check for distortion. Forks can be bent out of shape. Contact the forklift manufacturer to find out if the fork can be straightened.
• Check for cracks in heel and hanger. Cracks can appear on forks where attachments are welded on or in the inside radius of the bend area. Use a magnetic particle or dye penetrant test to detect cracks.
• If necessary, replace the forks with good-quality forks. Insist on forged forks or ones with an upset heel.
• Use the proper forks for the job. You may need to order custom-designed forks for things such as unusual lifting conditions, spark-free areas, high-heat furnace areas or special object lifting. Contact your forklift supplier for assistance.
• Contact your fork manufacturer to undertake any repairs needed.

For more information on forklift safety, visit the CCOHS Web site at www.ccohs.ca.

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Alison Dunn is the assistant editor of PEM Plant Engineering and Maintenance and the editor of industrialsourcebook.com. You can reach her at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

If you have noticed that 50 percent or more of software implementations fail, you are probably ahead of the pack. What is important is to determine why implementation fails. Not surprisingly, one of the biggest reasons is lack of buy-in from operations, top management, workers and other key stakeholders. Another common reason is the lack of a solid implementation methodology that starts with strategy, establishes performance measures and targets for the improvement project, and ends with accountability for delivering against the targets.

This kind of methodology should focus on process. Here are some of the key elements to developing a sound participatory approach to the design and selection of an implementation process.

1. Form a steering committee of approximately nine to 15 people representing top management, operations, maintenance, union executive, IT, R&D, accounting, QA, sales/customer service, external consultants, and any other personnel deemed appropriate. It may also be beneficial to have representation from head office and/or other plants where applicable. The steering committee should be responsible for providing overall direction for the project, ensuring that appropriate resources are made available and "signing off" on deliverables.

2. Select a "project champion" who will act as the committee's chairperson. The project champion should be a fairly senior individual to command the respect of both staff and management. He or she can then work closely with any consultants and the system vendor to set up the framework for the program, and will be responsible for the program throughout system implementation.

3. Establish task groups to study existing procedures and system requirements, develop recommendations, and implement improvements. Each task group should have a chairperson, who will likely be on the Steering Committee. Next, the task group can be responsible for studying a small area of the system. For example, one group could be responsible for work order control, another for inventory control, and a third for all other key systems.

4. Schedule approximately three "cast of thousands" workshops over a three to six month period, with task groups meeting on their own in between as required. The workshops should allow for a wider representation within the company — anywhere from 10 participants or more — to review the task group output. The outcome of the workshops and task group brainstorming sessions can then be redesigned as process flows and procedures.

5. Compile a list of potential vendors after reviewing the various options in light of the specifications developed by the task groups. Then obtain quotations from these vendors for evaluation by a "vendor selection committee", a sub-set of the steering committee.

6. The vendor selection committee must reach a decision on what criteria it will use to short-list vendor proposals. Just like short-listing a stack of resumes, the committee can use general criteria to fairly evaluate the written material received.

7. Each member of the vendor selection committee member should read through all of the proposals to get an overall feeling as to how the vendors responded. Don't attempt to rate vendors in the first reading, but make notes on each proposal to remember your initial impressions. Then, each vendor selection committee member should, individually, attempt to short-list the proposals.

8. Next, the vendor selection committee meets to reach a consensus on the short list. Eventually, the group will agree on which vendors to include on the list. If at all possible, only one or two vendors should be short-listed to maximize the opportunity to analyze in detail their software solutions before a firm contract is in place.

9. Committee members should plan on checking three or more references from each short-listed vendor and be prepared to visit at least one to three vendor sites. Make sure to talk to as many people as possible during the site visits, not just the vendor's own "project champion", who undoubtedly will have great things to say about their implementation process. Try to speak to the various users, from operations and maintenance, from workers to senior management.

10. Immediately following vendor demonstrations for each short-listed vendor, selection committee members must complete individual detailed ratings.

These detailed ratings can then be presented to the steering committee for discussion and approval. Make sure you consider status quo and/or upgrading the existing system as options, at least as a basis for comparison and a baseline for ROI calculations. The steering committee then approves the final vendor selection.

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David Berger is the managing director of Grant Thronton Managment Consulting in Canada and the founding president of the Plant Engineering and Maintenance Association of Canada. You can reach David at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

At a recent automation show in Paris, France, manufacturing engineers crowded around a computer screen that was remotely diagnosing faults in a servo drive. Using a standard Web browser, the engineers jogged the axis, ran profiles, and watched the movement of the drive 300 miles away in Sophia, France, over live Web camera feed. When a random fault occurred, the demonstrators easily diagnosed a broken feedback connection on the motor.

The most impressive part of the experience, however, was realizing that the entire process was accomplished using proven, readily available commercial technology that allows components from different manufacturers to be mixed and matched freely, easily, and inexpensively. The technology demonstration won awards in the Business Solutions and the Integration and Comprehensive Solutions categories at the Automation Europe show.

The system features programmable logic controllers (PLCs) with embedded Web servers that enable users to work with information in graphic form, as well as servo drives communicating with controllers over a SERCOS-compliant (Serial Realtime Communication System) fiber-optic link.

The backbone of the entire system is a TCP/IP-enabled Ethernet—rather than a proprietary—network, which makes it possible to share factory floor information throughout the enterprise over an Intranet and around the world over the Internet.

The result is a "transparent factory" that allows anyone with proper security clearance and network access to pull information from the PLC, display it on custom Web pages and change the parameters from anywhere in the world.

Using a servo drive with integrated SERCOS support, diagnostic data from the amplifier is combined with the diagnostic data from the PLC-based motion control and displayed on a Web page as graphical elements. Drive and motion parameters and even the PLC program itself can be modified—and the system retested—over the Internet without ever leaving the browser environment.

That's a marked departure from traditional proprietary plant networks (Interbus, Profibus, ControlNet, etc.), which provide a heavily customized, one-way architecture that collects production and diagnostic data, interprets it, and displays it on a Web server.

These types of systems provide users with no means to react to the data and send back commands that are then automatically implemented. The prevalence of such one-way systems has, in fact, inhibited the deployment of more open Internet technology in manufacturing.

Truly open, Ethernet-based systems that employ innovative uses of open servos, SERCOS, and the ability to embed a Web site directly into a PLC module could trigger two major directional changes for the industry: users will have the ability to remotely access machine control and diagnostic functions; and users will be able to use their existing PCs and laptops as operator interfaces, reducing the number of interfaces required on the factory floor.

Many users can use this new open system technology to help eliminate unscheduled equipment downtime. For example, if a user can remotely monitor increases in amplifier current draw, commonly caused by overheated bearings, the user can predetermine bearing failure. By significantly reducing downtime, users could potentially add tremendous value to their equipment without any significant incremental investment.

The web-enabled modules could allow users to remotely access all of their machinery and modify production parameters. Any authorized network subscriber could adjust machine throughput to meet raw material constraints or make modifications to manufactured product based on orders. This ability to customize production enables the end user to minimize raw material and inventories of finished goods.

Maintenance staff who have access to remote start-up support can upload their PLCs with pertinent information such as technical drawings, electrical specifications and other vital information to ensure smooth operation with maximum production. OEMs could minimize their on site start-up personnel after machine installation, and control engineers could spend more time at the OEM facility, adding value to future designs.

Machine operators can use the system to display statistical summaries. Any network subscriber could customize a Web page within the PLC platform to display production data in a manner that is meaningful to that user. Because the data is displayed graphically, an end user could make modifications with any standard Web browser without requiring a great deal of specialized training.

Today any complex machine requires its own stand-alone human-machine interface (HMI) so that operators can make changes, monitor processes and input or extract key information. With a web-enabled module, users can turn any computer or laptop into a HMI. Authorized personnel can dial up the PLC's Web address and access real-time machine data and/or change machine parameters using a standard Web browser. Operator screens designed with a standard HTML editor or by adding Java applets from within the browser can translate data into usable information and allow operators to manipulate virtual knobs and dials just as they would manipulate the real things. By taking advantage of Internet browser technology, anyone with proper clearance can access and read the information in a PLC without special proprietary knowledge — and they can then issue instructions to change the PLC-controlled processes. Users get the advantages of a PLC with the user-friendly graphic interfaces of a Web browser.

Remote motor diagnostics will become possible when web-enabled PLC motion modules and servo amplifiers are both SERCOS-rated. These systems should feature a fibre optic ring which takes full control of amplifier and motors. When the PLC address is dialed up, the user can access the motion module remotely and poll the amplifier.

This approach, which Schneider Electric is calling the "Transparent Factory," is made possible by segmenting Ethernet networks to eliminate the speed and determinism issues of the past. Intelligent bridge and router technologies form a path to extract information while providing determinism and speeds of 100 MB, 1 GB, and even faster speeds in some applications. Because Ethernet is the backbone of choice for many business applications, transporting data between applications and systems is no longer an expensive and error-prone task. Using proven commercial technologies and international standard protocols such as SERCOS, Transparent Factory takes advantage of off-the-shelf items such as Ethernet cards, hubs, routers, and Web browsers, thereby lowering the costs associated with training, support, and infrastructure procurement. The open architecture also allows a factory's automation environment to evolve with technology.

With this approach, the factory floor is no longer a remote, desolate island of proprietary networks that can communicate with the business world only through expensive, customized hardware and software. Instead, automation equipment is a natural extension of the massive world network that links virtually every other business system. And the availability of open, SERCOS-based servo systems extends the reach of those systems all the way down to individual drives. The combination of Ethernet-based Internet access and SERCOS-accessible drives on the factory floor could forever change the industrial automation landscape.

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Angelo Sanfilippo is a Motion Specialist at Schneider Electric.
You can reach him at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
(A version of this article first appeared in the July 2000 issue of Motion Control magazine.)

Maintenance professionals across Canada are beginning to look forward to one particular portion of the annual "Main Event" conference in Toronto (see page 4 for a wrap-up of the event). It's the ceremony where the Main Event's "Awards for Maintenance Excellence" are given out, and these awards are contested from entrants across the country.

This year, there were four awards up for grabs: Best Maintained Small Plant/Facility (one with less than 50 maintenance employees); Best Maintained Large Plant/Facility (one with more than 50 maintenance employees); Best Use of Technology/Maintenance Innovation; and Maintenance Manager of the Year.

The 2000 Awards for Maintenance Excellence were judged by a three member panel, made up of Bill Davison, president of the Plant Engineering and Maintenance Association of Canada; Jim Picknell, a consultant in the physical asset management division of PricewaterhouseCoopers and the chair of the Main Event conference, and Paul Challen, the former editor of PEM Plant Engineering and Maintenance magazine. The three judges met during the conference to weed through the nominations from well-qualified entrants, to come up with the deserving winners.

Emerging as the Best Maintained Small Plant/Facility was Nitrochem Corp., of Maitland, Ontario. Winner of the Best Maintained Large Plant/Facility was Suncor Energy of Fort McMurray, Alberta's upgrading division. The award for the Best Use of Technology/Maintenance Innovation was captured by pulp and paper manufacturer Irving of St. John, New Brunswick. And taking home individual honours as Maintenance Manager of the Year was Alan Richards of Gennum Corporation in Burlington, Ontario.

In the pages that follow, you'll get to meet these four winners, and will have the chance to learn more about the world-class operations that mark the day-to-day sites where these award-winning efforts take place. We hope they'll give you a glimpse into the highest standards of maintenance currently being practised in Canada.

And from us here at PEM, we'd like to extend congratulations to the deserving winners.

Finding the right maintenance chemistry

Best Maintained Small Plant/Facility
Harold Neumann, Maintenance Manager
Nitrochem Corp., Maitland, Ontario

Talk to anyone involved with plant maintenance and operations at the Maitland, Ontario site of Nitrochem Corp. — one of Canada's largest producers of nitric acid, ammonium nitrate and nitrogen solutions — and they'll likely return to one, unifying concept. It's what they call "mutual trust," and for the maintenance team at the eastern Ontario plant, it's the central theme in a five-year restructuring plan.

A determined co-operation between maintenance and production departments paid off in many ways, including a jump in overall uptime of 86 percent in 1994 to 92 percent in 2000, and a marked decrease in plant shutdowns from 294 in 1994 to only 24 in 2000, plus a considerable savings in overall maintenance budget and a bearings-failure decrease — due to an improved oil analysis program — of 300 percent.

"Our common goal was plant reliability and cooperation between maintenance and production," says Harold Neumann, maintenance manager at the plant and one of the driving forces behind the improvements that have been taking place at Nitrochem ever since a massive fire destroyed the majority of the processing capacity at one of the facility's five plants. "The aim was threefold: to reduce the amount of emergency work; to identify potential equipment failures and to address these repairs during the day to prevent downtime; and to plan repairs to co-ordinate with production requirements so that a full repair could be achieved instead of a Band-Aid solution. This meant that both production and maintenance teams had to work together to prioritize their workload."

Neumann is quick to spread the credit for the improvements around the plant. "Our first step was to build the foundation we needed to implement our maintenance practices. The employees became part of the decision-making process and planning stages," he says. "Our programs were employee-owned and driven. We gave our people the authority to address and solve problems. In time, they became self-motivated and safety-conscientious workers."

Part of the drive toward employee empowerment was motivated, Neumann says, by a desire to increase the visibility of the maintenance staff within the plant as a whole — to move from a culture of simply fixing machinery to one that prevents failure and troubleshoots possible breakdowns.

But how was all of this accomplished? The key, says Neumann, was dialogue. The maintenance team implemented Monday management meetings, and daily 8 a.m. "tailgate meetings" for 15-20 minutes to discuss upcoming shutdowns, safety equipment, and any incidents or concerns that have been cropping up on site. These were complemented by "safety walks" to investigate work requests that had special safety concerns.

Another of the keys to the award-winning initiative was the creation of a new position within the maintenance team. It's called the "plant inspector," and this planning/scheduling position is filled at Nitrochem by Roy Arter, who accounts for more than 90 percent of the non-destructive examination testing at the plant.

Training has also played a big part in the five-year plan. In 1995, Nitrochem millwrights began a comprehensive laser alignment training program, which was followed by further skills-development in vibration analysis for all plant rotation equipment, and the oil analysis program mentioned above.

The shift in maintenance culture at Nitrochem has had some other concrete, labour-based effects as well. Prior to the changes, the maintenance crew worked shifts. Now they work straight days, supplemented by a call-out list for emergencies. "About the only complaint we hear now from the team guys is that there is not enough opportunity to work overtime," says Neumann.

A reliable source of energy

Best Maintained Large Plant/Facility
Mike Blanchard, General Manager of Maintenance and Engineering
Suncor Energy, Inc., Fort McMurray, Alberta

"Communication has to be non-stop. You have to share your strategy, involve the workforce, share the results of your efforts. You will get a small percentage of the shop floor that will not buy in to change, but you have to remember to keep moving forward. It has taken us four years to get to where we are today at our facility and we still recognize many areas for improvement. We have found that the path to excellence is never ending but the gains made are highly rewarding."

That's Mike Blanchard, general manager of maintenance and engineering at the oil and gas refining giant Suncor Energy, Inc.'s upgrading division in Fort McMurray, Alberta. He's talking about the central philosophy that helped his division win this year's award for best-maintained large facility.

Blanchard says his maintenance team believed that while they had some good basic maintenance practices in place four years ago, they knew there was still room for improvement. They focused on mechanical availability, followed by maintenance costs. The process started with a review of overall maintenance practices — individual roles, responsibilities, planning, work order process, measures, etc. — and the development of an agreed to strategic plan.

The division was helped along by PricewaterhouseCoopers in these areas (they were nominated for the award by PWC consultant Len Middleton, who had worked with the Fort McMurray-based operation in their maintenance upgrading efforts), and the two organizations worked on benchmarking key processes on the electrical/instrumentation side of maintenance, as a way of moving ahead. "Before taking benchmarking on as an initiative, one has to have an appreciation of the time, resources and commitment that it takes. One of our benchmarking initiatives in the area of electrical/instrumentation maintenance took about one year to complete," says Blanchard. "One of the many advantages of benchmarking is the learning from others and the wealth of information that can be exchanged. Benchmarking at our facility is a continuous process."

Another key strategic thrust at Suncor was an adherence to RCM methodology. "We got involved with the RCM process as part of our strategy to reduce our maintenance effort," says Blanchard. We have used RCM on a selective basis, and our RCM initiatives required an integrated effort by operations, process engineering, maintenance engineers and maintenance trades. It has helped us in optimizing equipment PM/Pdm's, understanding failure mechanisms, spare parts, etc. We view RCM as a long term investment."

Blanchard also gives credit to Suncor's system of improved turnaround planning, which he says can be expensive, not only in terms of material costs, labour, supporting structure, etc., but also because of lost production. "To assist us in achieving effective and efficient turnaround process, we maintain a full-time turnaround team led by a turnaround manager," explains Blanchard.

Things have certainly worked out well as far as streamlining several key maintenance practices, to the point where Suncor now has one of the lowest electrical/instrumentation maintenance costs per unit of output in the entire oil and gas industry. "A gain in reliability has helped us the most in lowering our maintenance costs," says Blanchard. "In the area of E&I we have moved more to condition-monitoring, improved planning and scheduling, and developed reliability teams focused on ?Â¥bad actors'. Basically, the shift has been from reactive to proactive maintenance, and this contributes to our ongoing effort to lower those per-barrel production costs."

Finally, Blanchard says that training in several key areas went a long way towards improving maintenance practices as well. The technicians at Suncor underwent gap-analysis tests on skills and job requirements, and from this, each person had a three-year training plan formulated for them. "There was not a big need for re-education, but the training was more along the lines of learning to utilize new technology," says Blanchard.

Putting it on paper

Best Use of Technology/Maintenance Innovation
Doug Walker, Maintenance Manager
Irving Pulp & Paper Ltd., St. John, New Brunswick

Although he's the man at the helm of this year's award for the best use of maintenance technology or maintenance innovation, Doug Walker, the maintenance manager at Irving Pulp & Paper in St. John, New Brunswick, is quick to spread the credit for the accolades around to his maintenance teammates at the paper-making giant.

"These are the guys who did all the work — I'm just the one with his name on the top of the nomination form," says Walker of the company's victory. The guys Walker is talking about — maintenance mechanic Jerry Roberge; maintenance mechanic and lead trainer Bob McInnis; and reliability engineers Jean Albert and Mike Bonga — formed the core of the award-winning team.

For 2000, the team identified a six-part strategy for improving maintenance practices. This was comprised of:
- re-defining the role of the maintenance department as a "premier supplier" to other divisions like operations and engineering within the company;
- establishing the principle of "environmental stewardship" to cut down on spills, leakage and losses;
- developing a profitable and self-renewing methodology aimed at reducing maintenance costs and improving databases to ensure accuracy of performance-measurement indicators;
- implementing a mill-wide technical excellence program, including a comprehensive vibration-analysis and tank and vessel inspection programs;
- a commitment to the development of personal performance improvements, monitored by planning and reviews between maintenance staff and managers; and
- the reinforcement of Irving's position as a valued community member, with maintenance playing a key role in the facility's physical appearance to the outside world.

"There really were a lot of continuous-improvement issues we had to address," says Roberge. "And we wouldn't have accomplished any of them if we didn't work together. By getting people on all levels of the organization to work together, we were able to improve the decision-making process in maintenance."

Part of the key, says Walker, was in identifying world-class levels of maintenance performance, developing the methodology to achieve them, and then getting the message on how this was to be accomplished across to teams at all levels. And the success of that initiative lay in this collection of accurate information. "About 18 months ago, we determined that we really did not have the right kind of data to guide us — to help us determine where productivity losses were being caused. Our existing ERP program was not helping in this area, so, in a mill-wide initiative, we wrote our own software, to capture better data that tells us exactly what to fix, and when."

This software initiative also went a long way towards encouraging the staff empowerment that the Irving maintenance department was hoping to further. "Now we drive the software, instead of it driving us," says Albert.

Another key aspect to Irving's success in maintenance was training. Instead of bringing in an outside trainer or looking for an in-house employee who specializes only in training, Walker and his team decided to look within the facility itself. They found McInnis, a self-confessed "hourly sheet-metal guy" and union representative, who was more than happy to establish his own in-house training program in the kind of skills Irving needed to push their maintenance efforts forward. "This allowed a lot of overlap," says McInnis. "It allowed people from the mills to get an introduction to various trades that they would not have otherwise been exposed to, and to develop our labour force to a much greater extent."

High-tech success

Maintenance Manager of the Year
Alan Richards, Equipment Engineering Manager
Gennum Corporation, Burlington, Ontario

Alan Richards' first year at silicon components manufacturer Gennum Corporation in Burlington, Ontario was a good one. Although Richards, a native of Wales who's also worked in the high-tech field in England and Ireland, only arrived in Canada in January, 2000, he capped off the year by winning the Maintenance Manager of the Year award at the Main Event.

Richards won the award based on a comprehensive series of maintenance improvements he spearheaded at Gennum. "The basic idea is to establish people in our department as equipment owners, as opposed to equipment users," says Richards. "Once someone starts to think of themselves as owning a tool or piece of equipment, they start to sort out maintenance questions and problems more pro-actively."

One of Richards' key initiatives was to establish a new position with his equipment engineering group — that of the CEC, or Cluster Equipment Coordinator. The people nominated to these positions then took on supervision responsibility for smaller groups of personnel, which in turn allowed for better communications across shifts and a reduction in the overlap of resources. "Essentially, this is a team-leadership position, and again, the person in this role takes on responsibility for equipment availability," says Richards. "It basically saves us a lot of time running around, and a lot of overlap in effort. It's classic micro-management, and drops the ratio of worker to supervisor from about 18:1, to 4 or 5 :1.

Richards has also done extensive work in improving Gennum's preventive maintenance database, including the implementation of a SWAT- special work action team — group, that works to address extended down-time problems that measure longer than 24 hours of equipment non-availability to manufacturing.

"The important thing was to change the culture here to one of predictive maintenance," says Richards of his relatively short time at Gennum. "There appeared to be a lot of doing PMs just for the sake of doing PMs, and in high-tech industries in particular, where replacing equipment can be extremely expensive, this isn't an effective approach. It's far better to work on predictive and preventive measures."

Richards has also implemented another policy which is key in the high-tech field — that of tighter clean-room policies as far as the introduction of new and ancillary equipment into the clean-room facilities. And, he's introduced a thorough TPM initiative within the plant's assembly areas.

So what does Richards think of winning Canada's major maintenance award such a short while after arriving in Canada? "Well, it was certainly a nice welcome here," he says.

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Paul Challen is the former editor of PEM Plant Engineering and Maintenance. Janine Belzak is a freelance writer who lives in Dundas, Ontario.

It used to be simple. You needed a new maintenance management system, and you had two choices: build something small or, if your need was larger (a few or more users, some robust features, and you didn't know how to write software), you bought a specialized package.

And whether you built it or bought it, it generally did what you wanted. It had a nice little "database" in it, it gave you some information, answered your questions, and made some historical reporting easy. Whether the problem was maintenance management, work order tracking, spare part inventory, or whatever, it was contained in your department and your local solution offered you some benefits.

No longer. Now everything needs to be integrated. That was two years ago. Last year someone told you it needed to connect to the Internet. And this year, it needs to be connected with applications you've never heard of — some on the Internet, some because of the internet, and some because of other developments in the company. And everyone needs to know everything. That nice little work order tracking system you had suddenly isn't connected to the company ERP, and the integration is leading to duplicate entry, some errors and is a growing nuisance.

More importantly, it's also becoming clear that by putting in all the information there are some big wins available. Everything is becoming more competitive, and big wins are good.

Historical choices — make or buy?

Make
Making software, or the usual software development process, was typically only practical if the need was small, or necessary if the problem was unique. The proliferation of little database systems to track everything from certification and credentials to work orders is nothing short of rampant in most medium and large companies. Talk to almost anyone about the tools they use, and at least a few of these tools show up.

The other case where you needed to build software was where no reasonable commercial product exists. While this is becoming less and less the case, it is useful to remember that most commercial products have their roots in some innovative idea launched in the bowels of some company' s operations, and later became commercialized. There are still lots of useful things that commercial products don' t do that help innovative companies to move the yardsticks forwards. But that represents a good test.

Buy
The case for buying software was sometimes tricky too, but generally got approved. When you needed a tool, you could usually find either an inexpensive point solution, or a more easily approved module to a larger company investment, like a special module of their ERP. But often that ERP module didn't seem such a good choice — it was often more expensive than the point solution, it had higher maintenance costs, it did new things you didn't need to do, and the kicker was, it usually didn't do everything you wanted quite as appealingly as the little point solution to which you compared it. The benefit of integration that the ERP vendor may have also promised seemed nice, but it may have been unconvincing at the time. But at least the path was clear. You knew where to go to find products, you knew the choices and you never really worried much about what was coming in a year or three.

New choices, new issues

Making software
This choice continues to exist, though it is becoming increasingly difficult to build meaningful larger tools as the software explosion offers new tools for just about every problem ever imagined — though admittedly not always great tools. In those pockets where there is some software development talent, and where good modern tools are put to use, it is possible to develop robust applications that make a meaningful difference to operations and management of industrial plants.

Buying software
This has undoubtedly become considerably more complex for your average support function. While the principles remain the same, all the dimensions have become more multi-faceted. Where you go to get software has grown (see below — Sourcing software becomes more complex). What software can do for you has become harder to evaluate. Less tangible benefits like integration have become more tangible. And the pricing formulas have become more sophisticated. And everyone is talking about software helping you to modify your processes — with rich promises, and while you are convinced your processes can be improved, which vendor is right is becoming part of the question. And finally, it' s no longer even clear you need to buy the software.

Renting software
This is the newest idea, and while it's been around for a while for big companies with big problems, it has become widely practical only with the Internet. It is increasingly becoming a viable option and offers a number of benefits:

- Monthly payment models, avoiding the large capital requirements;
- Forcing the adoption of more "vanilla" implementations, which lowers costs, increases time to market, and prevents the customization which often re-introduces older, less effective practices;
- Typically rented software will run as part of a service, offered by some form or other of "outsourcer" and what you are buying is really the service of using the software. This has the further benefit of freeing you from owning and maintaining the hardware.

In times of rapid technological innovation, software becomes obsolete in short time frames and new versions come with high upgrade costs. The costs come typically from needing more hardware and more labour to implement the new versions. In this scenario, renting software often provides a net cost advantage when considering the total cost of ownership.

The biggest concerns with this model generally revolve around the concept that if you don' t own it, you don' t control it. With rented software you can' t make it exactly what you want it to be. What if it goes down? What if your communications fails?

There are of course a host of new issues:
- Organizations are no longer inspecting software agreements to see their rights and obligations, now they are signing software service contracts, and measuring performance;
- You select a supplier on features, but you evaluate the supplier on service. We need new evaluation models and new performance monitoring models;
- Things you completely controlled before, like your security environment, are now shared and integrated with your supplier. This can expose you to new risks, but can also bring some benefits (many organizations really don' t do that good a job on security — you can mandate it when it' s a service.);
- You are, even more than before, consigning key tasks to a supplier. You are looking for a good partner to assist you — and should be evaluating a potential supplier on that basis;
- Finally, the financial case is generally more complex. While the purchase agreement was a relatively well understood transaction, the rental/outsourcing deal will be a somewhat more sophisticated agreement with some continual tugs.

Sourcing software also becomes more complex

The next issue that has become more complex is the whole notion of where to go to get potential software and services. Assuming you are buying or renting software (i.e. somehow exploiting a package), there are many more choices than before. The following sections describe the range of choices.

Point solution vendors
There is a vibrant market out there in many areas of specialty suppliers, making a unique software product to fill almost any niche. The problem is finding it. Usually you identify a point solution vendor in either of three ways:

- They've come knocking on your door;
- You scanned your competitors or other companies with like challenges and solicited their vendors; or,
- You used a consultant. Your consultant will attempt to scan the landscape, identifying the key packages, and pointing out your options. And the vendors are likely courting the consulting firms (certainly if it's a big consulting firm) so the consulting firm should have some awareness of the product.

But beware, your consultant will likely only be aware of the larger, more important players in any niche. They might see it as too risky to recommend a product that is new, precisely because it has no track record.

ERP vendors
The ERP vendors are increasingly offering a full service package, with specialized modules that are delivering continuously increasing coverage. If there is an ERP vendor established in your firm, it will likely have a module or a partnership with someone who does, to address your need. This is a good place to go looking for important modules.

Hardware vendors
Your hardware vendors have almost certainly also formed relationships with software suppliers of almost every stripe. The hardware vendors of note here are the ones who sell specialized hardware that are used in maintenance, planning or other similar activities.

Often highly technical test or other plant equipment will support data feeds, and these vendors will often be able to offer either their own software or partner's tools to support your application needs.

Competitors, partners & suppliers
The final category of software source may well be other players in your industry. There are many examples, in many industries, where a large player has developed software that is used by its suppliers or customers. In some cases, the software has become so well entrenched that it has become a de facto standard, and may be offered on a commercial basis.

Renting software — different models

Given that you've now found the software you want, and if something other than buying it outright appeals, there may be some preferred model to rent it. The vendor may have a preference that it presents to you. Or you may have a wide-open field. There are at least five different models to rent software, with more and more variations on them, emerging all the time.

Outsourcing
The first, and still a common one, is to strike some sort of custom or unique arrangement with a firm that can offer you the service. Generally the firm in this case will only offer the "hosting" of the application. The hosting service will offer you some hardware capacity, some performance guarantees, but you will be responsible for installing, tailoring, and operational efficiency. While this is a growing business, it is the lowest level of outsourcing.

ASP (application service provider)
A middle ground position is the Application Service Provider (or ASP). In this option, the firm knows the software you are choosing and will run it and manage it for you. Their responsibilities will include, in addition to the hardware, the software installation, tailoring to your specifications, and the monitoring of the ongoing application to ensure it continues to perform as required. They will typically manage upgrades, ensuring seamless cutover of your operating environment as appropriate. Your responsibility is to use the system, and this is an increasingly attractive and common option for many firms.

This model has been made much more attractive by two forces: the increasing market presence of leading products in key niches, and the widespread availability of internet-based connectivity.

BPO (business process outsourcing)
This is a considerably farther-down-the-continuum option. In the BPO (or Business Process Outsourcing) case, the company outsources the whole business process. The people who do the function on behalf of the company actually operate from the outsourcing provider. This option generally involves a transfer of staff and technology to the BPO supplier. This option requires different contracting approaches again, but is generally attractive under a variety of conditions, such as:

- are essential to the business, but not core to the company's competencies (e.g. oil companies use BPO to deliver some accounting and finance functions);
- internal support in some cases is reasonably provided by staff from an external supplier in a number of cases (such as technology support, or some hardware maintenance functions where the hardware is very specialized).

This option is often particularly interesting where large technology (or other) investments are required for a host company. In these situations, a BPO supplier who will have expertise with the function may be able to offer the function for a more stable pricing model, and provide a comparable or superior service, all for a predictable cost.

Exchange-based services
Given the recent emergence of internet-based B2B (Business to Business) exchanges, it is appropriate to point out that most of these services offer at least two forms of outsourcing services:

- Outsourcing services, in which the exchange will provide on a pay-per-use basis whatever its core service is generally some form of market making. On that basis, there is a service agreement to use certain functions offered by the exchange, with some level of performance expectations, and some level of fee recovery. These arrangements are not yet standard, though the terms are slowly becoming somewhat more standardized.
- ASP services, in which industry participants can access a shared implementation of software that is required in the industry or by the exchange. For instance, it is common for some of these exchanges that are, say, focused on procurement, to also offer a full ERP if the company needs that function. These are often referred to as value-added services.


Vendor-based rental models
The final rental model is based on vendor-offered services. Increasingly, a software or hardware vendor will offer software on a services basis, either itself, or in partnership with a third firm. From large ERP vendors, to special test equipment manufacturers, software and hardware companies are starting to offer interesting value added services. In this model a vendor will typically use the internet to 1) offer a hosted service for its software and services, and 2) offer a value-added support service in which their people manage or simply maintain the system.

These are becoming increasingly common with complex and specialized systems. Indeed this model is expanding to encompass quite a wide range of services, including in such technical areas as computer network management, and computer network security, and plant equipment maintenance. In a world where a coke machine can call for more coke when it empties, and where a car can diagnose itself, it is no longer unusual for sophisticated test and measurement equipment to contact its manufacturer when it detects that it needs servicing.

Key decision criteria

So, given all of these dimensions, how do you choose your approach? What factors will be most important as you consider rental arrangements? There are at least three key factors, described below.

The business case
The big question, of course, is "which is cheaper — buying or renting?" The answer, like buying or leasing a car, is that it's not always a question of cheaper, and in some ways the cost differences are a bit of a wash. Renting is not usually a way to get something cheaper, but it can offer a different model for incurring the cost, and avoiding other components.

Indeed, for many organizations who outsource, the reduced need to acquire hardware and maintain sophisticated technical environments is more than enough reason to pay a reasonable premium over the cost of the software — all to get a stable pricing model and a reliable service.

In many cases, the business case should assess the "total cost of ownership"or TCO, of both approaches. When considering all aspects of the outsourcing arrangement, the payback can be quite attractive on some outsourcing arrangements. In other cases, where the payback is less compelling, operational simplicity may be a desirable factor.

Internal integration
Any product you pick will almost certainly need to be fully integrated with other key systems in your organization. The degree and ease of integration should be a key element of your investigation into potential products.

A particularly important element will be the degree to which the product has an open architecture and is "Internet-capable". The open architecture means that it can share and access data in other related applications with ease, preferably invisibly to users and without manual intervention.

This level of integration will make future operations considerably simpler. Internet-capable means the product can interact with other applications when connected via the Internet.

For example, test equipment that can notify the manufacturer when it falls out of spec would be Internet-capable. Even better, perhaps the manufacturer can adjust it for you remotely, and avoid a service call, or at a minimum call to schedule a service call for when the machine will be down next. (If you share the machine's schedules with them, they may even know when it will be down next.). Now that's Internet-capable.

The vendor as partner
The last criterion is to assess the vendor as a true business partner. This is no longer a one-shot transaction — you will be doing business with them for years. You care about three things:
- You like doing business with them;
- They'll negotiate a reasonable contract; and
- They'll be around for a few years.

The combination of these criteria reminds us of the partnering nature of outsourcing arrangements. These deals are more sophisticated than pure software purchases, but they offer a number of benefits explored in the article, ranging from managed, sometimes lower costs, to superior service or capability, and sometimes the ability to rent software that might otherwise be unaffordable. While the choices have become more complex, and the considerations more multi-faceted, the nature of the many different software rental forms now available serve to help many different companies achieve more sophisticated goals without needing to be an expert in every aspect of every complex tool and product they use.

These non-trivial benefits ensure that the many different rental models will flourish and become ever more compelling in the near future.

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Ron Schwartz has national responsibility for consulting services in E-Business technology solutions with PricewaterhouseCoopers, where he has worked since 1987 in the information technology practice. He holds an M.B.A. from the University of Ottawa, jointly issued by Northeastern University (Boston) and the Ecole Superieur de Commerce (Reims, France). You can contact him at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

Imagine how effective a performance management program could be in an enterprise where every employee, regardless of level, department, locale, or job function, was focused on achieving performance targets that contributed to the same goals and objectives. Sophisticated performance management capability is one feature that differentiates the Computerized Maintenance Management System (CMMS) or Enterprise Asset Management (EAM) system of today from those of the past.

For years, CMMS was transaction-based (ie, recording and reporting on hours worked and material used to maintain equipment). The modern CMMS however, moves the focus from transactions by providing better planning and analysis tools. This leads to less fire-fighting and greater emphasis on performance management in a more planned environment.

There are three key components of a CMMS-based performance management program, and the steps required for a successful implementation. The components are:

• Planning
• Data Collection, and
• Analysis

1. Planning

Develop a strategic plan
Proper performance-management starts with setting goals and objectives at the highest level of the enterprise. Drivers at this level are: improved financial performance, better management of risk, greater operational efficiency, increased employee satisfaction, and increased customer loyalty through an improved value-for-money proposition. From a quantitative perspective, sample objectives might be improved earnings per share, increased return on capital employed, and so on.

Cascade the strategic plan downwards
Develop a strategy for every strategic business unit, such as a group or division, that will deliver on the goals and objectives of the overall enterprise. Each functional area (marketing, operations, information technology, and human resources) can also develop a strategic plan in light of enterprise-wide goals and objectives. This will translate into functional strategic plans at the group, divisional and plant levels.

Some companies use tools such as the Balanced Scorecard to provide the strategic measurement framework at all levels in the enterprise. The scorecard approach starts with the strategy and vision for the enterprise and then breaks it down for each strategic business unit into four areas:

• Customer view (retention, customer satisfaction);
• Financial view (ROI, cost reduction);
• Internal business-process view (innovation, operations); and
• Learning and growth view (employee/IT capability).

Each level in the enterprise is responsible for developing performance measures and setting targets for each of these four views. Reports on progress in meeting targets are published on a monthly basis for each business unit. Most, if not all, of the relevant measures for maintenance operations can be tracked on the CMMS. Similarly, a good ERP system will track the measures relevant to production.

Set performance measures and targets — regardless of whether or not a scorecard model is used, each business unit should commit to qualitative goals and objectives, as well as quantitative measures and targets for each corporate-wide driver. Table 1 shows sample measures and targets for the asset management function, most of which can be tracked by the more sophisticated CMMS packages.

Develop action plans
To meet the targets set at all levels, you should identify action items. For example, if for the next 12 months you want to reduce the spare parts inventory level by 20 percent and cut the frequency of stockouts of critical spare parts by 10 percent, there needs to be a clearly defined plan as to how that will happen. Action items might include identifying and eliminating obsolete inventory items, classifying the inventory using the ABC and XYZ inventory classification model, tracking service levels by inventory class and adjusting inventory levels accordingly. Advanced features available on some CMMS packages will facilitate the collection and analysis of data for ensuring this is possible.

Prepare budgets
Formulate a long-range budget based on the action plan and targeted performance levels. This is followed by a more detailed mid-range budget for the next 12 to 18 months. Finally, very detailed budgets are required on a monthly or quarterly basis, down to line item account and/or activity codes. A CMMS equipped with activity-based costing can help tremendously in planning where costs should be incurred.

Develop personal plans
Many companies have discovered the tremendous value in integrating the performance management program described above, with the remuneration, career advancement, reward and recognition of employees. Performance measures and targets can be defined for each job function for which an employee is responsible.

For example, a stockkeeper should be clear on quality, service and performance expectations for managing the stockroom. This includes measures such as: order error rate, response rate, and orders filled per day. Better CMMS packages are capable of tracking measures by employee, but be wary of using the software for discipline purposes as this smacks of an Orwellian "Big Brother" mentality. The consequences might be employees entering incomplete or incorrect data.

2. Data collection

Once plans are set, the CMMS is used to collect actual data from many manual and automated entry points. The more progressive shop-floor data collection systems interface with wireless remote terminals, programmable controllers, barcode scanners, and so on. The key is collecting accurate and timely data at a sufficient level of detail.

As well, data should be captured once and only once, as close to source as possible in order to preserve a single version of the truth. This is more likely with a highly integrated CMMS and database. For example, hours worked by tradespeople should be recorded once, for both payroll and job costing purposes, even if the data feeds two distinct systems.

3. Analysis

The modern CMMS has tremendous analysis tools available to help monitor progress in meeting performance targets, and assisting management in identifying further improvement opportunities. These include: reliability-centred maintenance, condition monitoring, knowledge-based diagnostics, economic order quantity modeling, service level simulation for spare parts inventory, supplier history analysis, workflow analysis, activity-based management, and many other tools.

The CMMS can also report on variances to budget in a variety of ways such as by work order, piece of equipment, location, shift, and tradesperson. Significant variances must be explained so that you can take corrective action, and/or the performance targets and budgets are modified.

By exploiting the power of today's sophisticated CMMS, management can focus the energy of individuals and departments on meeting performance targets and ultimately the goals and objectives of the overall enterprise.

Surprisingly, studies show that only about 30 percent of the functionality of CMMS software is actually used. This is because the majority of companies are still transaction-focused. This is good news for those companies that do use the analytical features of a modern CMMS in support of a performance management program.

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David Berger is the president of Lamus Consulting in Canada and the founding president of the Plant Engineering and Maintenance Association of Canada.

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TABLE 1: Sample performance measures and targets

Driver	Performance Measure	Baseline	Target -- Year 1
(Internal) Customer satisfaction	Average cycle time (eg. repair time)	84 minutes	25% reduction
---	Average response time for unplanned maintenance	12 minutes	2 minutes or less
---	Operator work effort (eg. machine adjustments	17 minutes per operator per shift	50% reduction in non-value added work effort
---	Rework	5% of jobs have to be reworked	2%
Employee satisfaction	Average time spent doing administrative work	42 minutes/person/shift	Reduce by 50%
---	% of transactions requiring authorization by a supervisor	62%	Reduce by 50%
---	Training dollars spent per employee	$120	$400
Operational capability	Average downtime	5%	2.5%
---	Average tradesperson utilization	50%	75%
---	Maintenance cost per ton of finished product output	$1.20	$1.10
---	Average spare parts inventory turns	3	6
---	Average mean-time between-failure	1.4 hours	2 hours

Most discussions in the media and across the conference circuit refer to the maintenance department as a single cog in the Lean machine. According to experts, however, the maintenance department is at the heart of any continuous improvement drive.

Lean manufacturing comes from the systems and processes of the Toyota Production System. Toyota has been heralded by industry-watchers as supremely effective at producing high-quality products while reducing costs and shortening cycle times. For more than 10 years, cult-like followers of the Lean movement across North American industry have dabbled in this innovative Eastern approach to cost-saving manufacturing.

Vought Aircraft Industries is just one aerospace manufacturer that has tried to go Lean.

Joe Bechtol, director of facilities and security at Vought says that its maintenance and engineering department was instrumental in the initial implementation phase and continues to play a key role in supporting the entire process. With both a traditional maintenance organization and a comprehensive engineering staff that incorporates electrical, mechanical and civil disciplines, Vought's maintenance crew handles two different yet related aspects.

"The engineering group lays out the process of change — redesigning the floor layout and cell operation — and the maintenance group implements the changes — moving, retrofitting and rebuilding equipment. When the floor comes up with a concept of change, we are instrumental in the implementation," says Bechtol.

Headquartered in Dallas, Texas, Vought Aircraft Industries, Inc. is one of the world's largest independent suppliers of aerospace structures. As a major provider of components for prime manufacturers of aircraft, the company has worked on virtually every Boeing jetliner in production, from the 737 to the 777. This 5,000 employee, $1 billion a year firm is roughly eight years into its Lean journey and openly discusses how its implementation has specifically impacted its maintenance and facilities engineering department.

Starting the journey
According to Vought's manager of engineering and lean implementation, Lee Mitchell, "Vought Aircraft started on its Lean journey in 1993 as part of the Lean aircraft initiative put together by the United States Air Force, Massachusetts Institute of Technology, and a handful of key aerospace firms. Collaboratively, as an industry, we realized that we needed to make some significant changes from the mass production methods we implemented."

The group looked at how the major U.S. automakers were competing with foreign manufacturers by implementing the Toyota production system. Vought started the process by studying as many texts as possible with the intent of trying to take the ideas and see how they could apply to the aerospace industry. For instance, Mitchell says they started by studying the popular book, The Machine That Changed the World by James P. Womack, Daniel T. Jones, and Daniel Roos.

As the Vought maintenance team learned more about implementation, they recognized that the Lean principles needed to go across the entire enterprise, so according to Mitchell, Vought started to involve the above the floor processes of business management, engineering, and other support organizations. In each of these areas they started to look at where they could improve their value streams and eliminate waste.

The next step was implementing a cross-company campaign that raised awareness of the Lean philosophy and reducing wasteful practices. Vought employees understand Lean principles and are aware of what management is trying to accomplish. "Employees now see what can be done individually and as team members to further the initiative by making improvements and eliminating waste," said Mitchell.

Obstacles and benefits
Undoubtedly, the biggest challenge any maintenance department involved in the process is the balancing of resources to meet the demanding needs of a Lean environment. Over time, the requests on maintenance actually increase and the load can be significant.

"Lean has taken a great toll on the assets of maintenance." says Bechtol. Obviously there are a limited number of man-hours and various budget constraints that any organization has to deal with. "Unfortunately, we have let some of the backlogged normal maintenance slide be-cause we've had to focus energies on im-plementing Lean. Costs are actually taken away from the general maintenance and applied in priority towards Lean," he says.

Despite this, it is crucial to remember what Lean implementation is doing for the organization in the big picture, Bechtol says. "Understanding that makes a maintenance group set some priorities to meet the goals. You need to adjust to improve the production stream, which will eventually improve your cost structures. It does, however, definitely impact the day-to-day."

Some of the ways Vought has been able to cut waste has been in travel. By limiting the movement of both people and equipment Vought has been able to reduce its travel budget by 50 percent. Some of the perishable materials have been streamlined and reduced in need. And the maintenance department has been able to find items that are obsolete, thereby taking items offline and reducing the spare parts inventory, further helping with the cost structure. "Being able to eliminate outdated equipment has helped with the budget constraints," says Bechtol.

According to Mitchell, company-wide the most noticeable benefits have been in reduced inventory and span times through waste elimination. Response time has been improved, and taking Lean principles into consideration throughout the production process has yielded a positive impact upon the quality of the product. "The Lean tools are ensuring first-time quality allowing the firm to realize the next step of gains," said Mitchell.

Words of wisdom
Having eight years experience in the never-ending conquest of Lean implementation provides Mitchell and Bechtol with the opportunity to share some valuable advice to those that are new to the Lean process.

First, communication is absolutely essential. Not just at the management level, but to the individual on the floor. Everyone must have an understanding of the process to be a success. In union shops, bring labour on board early. This is key to demonstrating that the point of Lean is not to eliminate jobs but to eliminate waste.

Secondly, there must be support of the senior staff. "Support of the senior staff shows the employees that it is not just some trendy management flavor of the month. There must be a commitment. The CEO should be out on the shop floor showing the company's commitment to the initiative," said Bechtol.

Third, there must be a commitment of resources. There must be a budget of funds within the organization dedicated to the Lean initiative. If there is not a true commitment of resources, you will find that you are spreading out your Lean funds too thin. Involving the Lean implementation team in this process is key since this gives implementers an idea of whether or not an activity is cost-effective in the long run. Cooperation between implementation and maintenance groups is critical.

Fourth, stick with it. Anyone at all familiar with Lean will echo that it is not a short-term process. It is a continual operation and it takes years to realize the many benefits.

"You must have patience before you will see the benefits," says Mitchell. Realization in inventory reductions will definitely take time, especially if you are part of a firm that is historically sitting on a large amount of inventory."