Reduce maintenance costs? yes please – immediately | Wiegand’s Watch

Bodo WiegandThis is a translation of the bulk of Bodo Wiegand’s latest newsletter, about Lean in Germany, followed by my comments:

At the beginning of  this year I was at a company with a high level of Lean in Manufacturing and went into a discussion with the Board about how to go further the realize the full potential .

They did not want to get into the administrative areas, since there the world bosses were allowed to have their say — even though there was real potential there . But life in a matrix organization, as has been frequently noted , is very pleasant.  Before doubly protected kingdoms can be torn down, it takes usually a crisis or a new boss. You know my motto: “Give a slave of two masters and he is a free man . ”

Well then, what? We talked about opportunities in Manufacturing and, on our tour of the facilities, spent a bit more time on Maintenance. They were quite proud of the TPM plans they showed me, with a regular preventive maintenance plan, and involvement of production operators in routine maintenance. The whole range of tools set up and implemented was classic. Their pride was a new conveyor system, to which a maintenance technician was dedicated for inspections, routine maintenance, and troubleshooting . It sounded to me like: “With such investments, we must be able to afford this, to avoid the risk of failure .”

In another area , there were identical machines;  in the next hall several different presses. With the exception of heat treatment (3 shifts ) all areas were still working in 2 shifts. Of course, Maintenance is an area where you can see what happens inside just by looking from the outside. But my gut was telling me not to scream “wonderful” about the perfect organization. Instead, alarm bells went off and immediately came the question “What does the value stream look like?”  Proudly, the manager led me to the team leader room.  There hung the map. And I immediately saw  the date on which it was drawn. It was three years ago. Well, I expressed my concern: ” Is the new system taken into account ? ”

“No ”

This is a mistake we encounter often. Value streams change with the actions we perform and should be revised especially after new investments or major changes. Bottlenecks migrate and thereby change the production system. Back in the office, we discussed again his question of why the value stream is important to Maintenance.  I told him about Lean Maintenance. He asked “Should Maintenance be organized according to the value stream? – Why? ”

” In the value stream,” I answered, “bottlenecks are detected, critical facilities are identified from a customer perspective and process stability is visible. Priorities given to equipment are the basis for  maintenance and spare parts stocking strategies.”

That was too high-level for him.

So – I tried again. Equipment that is  the bottleneck or is in close proximity to customers is prioritized because it is important for delivery, and the bottleneck caps the production volume. If the bottleneck stops, so does the whole production system. If the last machine stops, which is important for  delivery, the safety stock increases .

Maintenance and stocks ? – The Board id not understand. ” What does Maintenance have to do with working capital ? ”

“Well, safety stocks are usually based on the worst-case  interruption time for repairs and mostly with people-related impact to it. ” In this case, it was three weeks.

It is usually two to three weeks – no one knows why.

“Can the maintenance strategy reduce working capital? ”

“Sure,” I answered. ” By prioritizing the facilities you identify the ones that are important for delivery . There you focus your maintenance activities and develop your spare part strategy. This is the only place where it is important whether this system fails. Failure analysis identifies the components that may be responsible. Then individual maintenance strategies must be developed for these components .

This starts with wear-dependent important components that are not predictable with sensor monitoring, and goes as far as the maintenance strategy of  “creating redundancy.”  The aim is to increase the process stability and to allow no loss. This reduces the need for safety stock . From that we get a feel for what would be the biggest shutdown and can estimate this time .

The next step is to optimize the maintenance time, ie to reduce the repair times to a minimum . If it is possible to organize the maintenance response to a quasi Formula 1 – standard, and you also develop a maintenance strategy adapted to it , you can make the maintenance times as short as possible. The safety stocks can then be lowered furthe . Gut feel no longer prevails. Instead, you have clear maintenance strategies based on numbers , facts, and figures. ”

” But isn’t that more effort? ”

“Perhaps on the facilities with high priorities. But why do you inspect machines that you take out of production for entire shifts? You have many working only 2 shifts. If a machine fails, it can be replaced by others. And why are you dedicating one person to your new conveyor system , which is certainly not a bottleneck?  Why do you thoroughly inspect your presses and have not considered how the failure of one could be compensated by the use of another. On such equipment “farms,” you do not need preventive maintenance in the classical sense, only a maintenance strategy that is appropriate for this case. ”

It is important to deliver and therefore you need a stable process. For this, you should evaluate the maintenance person, and not by cost. With a Lean Maintenance approach you will go from  failure-driven maintenance to  largely planned and predictable maintenance, requiring  less effort, providing higher process stability and reducing  costs for emergency response .

The result: we have reduced the worst-case repair time from 2.5 days to 8 hours, and safety stocks to two to three days, while reducing the costs of  external maintenance services by 80%.

The necessary investments in the sensors, redundancy or spare parts have been more than covered by the reduction in working capital. The annual reductions amount to a low seven-figure sum . The greatest gain was that the production and the maintenance staff are now working towards a common goal and are understood as a team . It culminated in this statement of the initially reluctant maintenance manager : “We want to be measured by the manufacturing productivity and working capital. “

Michel Baudin‘s comments:

What I read in Wiegand’s words is the focus of improvement in Maintenance should not be on structures and tools but on purpose. We maintain production facilities not to comply with a mandate or fulfill formal requirements but because it allows us to deliver goods to customers without large safety stocks. You might add that, if your products are custom, or even if you just have high variety, there is no way you can hold stocks large enough to deliver promptly.

In most companies, “Lean Maintenance” is taken to mean TPM and, within TPM, the only component that is implemented in the most basic, autonomous maintenance.  The headings for the higher levels of TPM include equipment improvementquality maintenance, and maintenance prevention but, even in Japan, you often hear managers say “We looked into implementing these, but decided they were not worth the cost.”

When you stick with autonomous maintenance, you have an approach to how the work is done but not what it is. This is a whole other topic. Wiegand states as the goal of maintenance to make interruptions of service less frequent and shorter. This is exactly what United Airlines focused on in the late 1960s when the Boeing 747 was introduced, and they called in “Reliability-Centered Maintenance” (RCM).

As part of this effort, they discovered that the “bathtub curve” of failure rates — that staple of reliability textbooks — only applies to about 4% of the aircraft components. In particular, many exhibited no tendency to fail more when aging, which made policies of periodic replacement pointless. They also developed the technique of Failure-Mode-Effect-Analysis (FMEA), on the basis of which they set policies for systematic replacement and spare parts stocks, and selected some items for targeted redundancies.

RCM was later adopted in nuclear power and process industries, and some RCM thinking has found its way into machine-shops, for example in the form of redundant tools in machining center pockets.

The criticism of RCM that I have heard is that it is a workaround to the limitations of the equipment rather than an improvement of it. It is better to have a cutting tool that lasts twice as long than to put a redundant tool on standby in the machine but then, you have to find such a tool.

Wiegand also seems to think that failures are not a problem when you have multiple, interchangeable machines with overcapacity. Technically, that’s unquestionable, but it is another story from the human point of view. It won’t be a problem next week, but what happens over time when overcapacity in an area allows you to have 25% of your equipment down? Your performance will eventually settle at a point where you actually have one machine in four down at any time. Why bother keeping all of them up all the time when they are not needed? Settling for this low availability, however, turns this process into a bottleneck.

TPM and Part Replacement Schedules

On the Lean Enterprise Institute website, a reader asked the following question:

“My management has hired a TPM consultant who makes us systematically replace certain parts in our equipment even though they’re working fine. This seems needlessly costly. What do you think?”

Over the years, “TPM” has become an umbrella term for all improvement activities in process industries, and not just maintenance. In this question, however, it is used in its original sense of “Total Productive Maintenance,” meaning involvement of all employees in the maintenance of facilities and equipment to support production. There is a body of knowledge associated with it, in which I don’t recall seeing anything about deciding when equipment parts should be replaced. Generally, TPM tells you how maintenance work should be done, not what it consists of.

TPM’s first step is Autonomous Maintenance, which delegates routine checks and small maintenance activities to production operators. There are many other, higher levels, but Autonomous Maintenance is the only one I have ever seen implemented, to the point that TPM is often equated with Autonomous Maintenance. Besides the scheduling of part replacements, there are many other aspects of Maintenance that I don’t believe TPM addresses, but that you have to in a Lean implementation, such as the role, structure, and size of the Maintenance department.

On these issues, I have found that you are more likely to find answers from industries where maintenance plays a more central role than in Manufacturing, such as commercial or military aviation, or nuclear power. On part replacement in particular, seminal work was conducted 45 years ago at United Airlines when the Boeing 747 was first released. United’s maintenance experts realized that the replacement schedules they had previously used on the 707 could not be economically carried over to the much larger 747, and they undertook a systematic analysis of the plane’s components that led to the development of a theory now known as “Reliability Centered Maintenance,” or RCM.

Bathtub2One discovery they made was that the “bathtub curve” of reliability theory textbooks only applied to 4% of the 747 components. According to that theory, a component is subject to “infant mortality” when new, wear-out when old, and have a “useful life” phase in-between, during which they have a low and constant failure rate.  It was observed on vacuum tubes in the 1950s, and assumed to apply to everything, with consequences on maintenance and part replacement policies. Obviously, you would want to monitor parts closely when new and replace them just before wear-out kicks-in.

What the United people found was the parts exhibited instead a variety of patterns and that some, in particular, never had a wear-out phase. As a consequence, there was no point in systematically replacing them after a fixed interval or use count.

The consequences of a component failure on an aircraft in flight also varied greatly depending on whether it is a passenger reading light, an avionic system, or the rudder. You don’t need the reading light to stay in the air and you can’t replace the rudder in flight, but you can have a standby avionic system take over. This  Failure Mode Effect Analysis (FMEA) served as the basis for targeted redundancies.

The FMEA concept is known in manufacturing, but I have never seen it applied to production equipment. Targeted redundancies are used, for example, in machining centers by placing the same frequently used cutting tools in two pockets, with the second tool automatically taking over when the first is worn out.

The equipment supplier can provide generic recommendations, but they may not match your specific application.  If you want to improve your equipment part replacement policies, you will need to collect and analyze technical data on the behavior of your machines, on your shop floor. With today’s sensors, data acquisition and control systems, it is technically feasible. If United Airlines could do it in 1969, you can in 2014. What is most missing is  analytical capability. Today’s Computerized Maintenance Management Systems (CMMS) are still focused work order administration, not the technical analysis of equipment behavior.

Once you have worked out appropriate part replacement policies, you need to work out the logistics of making spare parts available when needed, which is a whole other topic.