Finding the Hidden Factory
Content
Copyright 2010 GPAllied©
Ultrasound World VI 2010
Presented by: Mike Aroney
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
And to Accomplish the Mission
Copyright 2010 GPAllied©
Reliability is Critical to a Fighter Pilot
Copyright 2010 GPAllied©
To Land Safely
Copyright 2010 GPAllied©
Maintenance Personnel are Key to Success
Copyright 2010 GPAllied©
What Tool? When? (Right Tools, Right Time)
Copyright 2010 GPAllied©
The Global Opportunity
• GDP
– $46.6 Trillion
• Industrial
– $14.9 Trillion
• Maintenance Spend
– $447 Billion – 1.5-8X OEE multiplier
“It’s Ok to get excited about Maintenance!”
Copyright 2010 GPAllied©
Best Practice Benchmarking
“I could agree with you, but then we’d both be wrong”
1. Chemical Processing 2. Petro-Chem 3. Pulp & Paper 4. Automotive 5. Pharmaceutical 6. Metals & Mining
522 498 468 465 431 430
7. Power
8. Food & Beverage
373
369
Copyright 2010 GPAllied©
Areas of Return
• Cost reductions
– – – – – Labor utilization Contractor costs Overtime Materials cost reductions (inventory/usage) Energy usage
• OEE improvements (capacity)
– Availability – Efficiency – Quality
Copyright 2010 GPAllied©
Reliability Engineering in Maintenance?
Failure modes that no technologie s detect
Maintenance Costs ($)
Equipment on PM (%) Copyright 2010 GPAllied©
Failure Patterns
Initial Break-in period Bathtub
Pattern A = 4%
Time Time
Pattern D = 7%
Wear out
Pattern B = 2%
Pattern E = 14%
Random
Fatigue
Pattern C = 5%
Infant Mortality
Pattern F = 68%
Age Related = 11%
Random = 89%
Source: John Moore Copyright 2010 GPAllied©
Review of Vendor PM Recommendations
New Task 12% Extended Interval 23% Use As Is 38%
Reduce Interval 6%
Delete 21%
Tasks Analyzed
(include 96 new failure modes)
Source: Steve Turner, OMCS International
Copyright 2010 GPAllied©
PM Evaluation Categorize PM Recommendations
PM Task Action Recommendation
Non-Value Added or Reassign to Ops Replace with PdM
# of Tasks
5,876
% of Tasks
29.4%
Man-Hours Represented
23,867
6,437
32.2%
28,222
Re-Engineer No Modifications Required Totals
5,200 2,487 20,000
26.0% 10.4% 100.0%
26,221 8,987 87,297
Source: Allied PM Evaluation at a Steel Mill
Copyright 2010 GPAllied©
PM/PdM Optimization Organizational Impact
FTE Positions
PM Techs PdM Techs Planners Reliability Engineers RE Techs Balance of Crew
Before
43 0 0 0 0 57*
After
17 11 8 2 5 57*
Totals
* Notes
100*
Wrench time @ 28% 35 contractors 18% OT
100*
Wrench time @ 50% 12 contractors 5% OT
Source: Allied PM Evaluation at a Steel Mill Copyright 2010 GPAllied©
Capture Hidden Capacity Crafts Level
Copyright 2010 GPAllied©
• “…Nothing was missing, but we found three more…”
Copyright 2010 GPAllied©
How Do You Get There From Here?
Copyright 2010 GPAllied©
Synergy of “AND” Optimizes Reliability
High
+27%
Business Process and Culture Maturity
• Improved Bottom Line Performance • Lack of System Support
+75%
• Significantly Improved Bottom Line Performance • Practices and Systems Aligned
Baseline
•Informal • Manual Planning Processes • Below Average Business Performance
-7%
• Systems are not Complemented by Effective Business Processes • Significant Inefficiencies
Low
Low
Technology Maturity
High
Source: Brynjolfsson (MIT), Wireman, Troyer, Allied Copyright 2010 GPAllied©
Asset Health Processes
• Management – Efficient
– – – – Proactive Workflow – Planning & Scheduling Material Management Reliability Engineering Operator Care
• Leadership – Effective
– Creating a Culture of Discipline and Execution
Copyright 2010 GPAllied©
Change Management Values
80%
40%
3:4
29%
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
System Variation = Inefficiency
1. Selection 2. Leadership 3. Training 4. Reinforcing System
“We have processes…we just don’t follow them”
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
If You Have Good:
• • • • • Leadership Alignment Teamwork Change Management Innovation (both shop floor and R&D) You’re in an excellent position to achieve world class performance
– If you don’t have this, it doesn’t matter much what tools you use
Copyright 2010 GPAllied©
LEAN/Six Sigma - Systems Thinking
Leadership is Effective - Actions Act and Influence – “New Thinking and New Behaviors” Management is Efficient - Decisions Decide, Direct and Control – “Unfreeze & Freeze”
Management Tools Leadership People
Processes
Philosophy
Copyright 2010 GPAllied©
Leadership
• “…Leadership- the ability to inspire ordinary people to consistently perform at an extraordinary level…” – Ron Moore
• “…Leadership is an influence process. When you are a leader, you identify the needs of your team members and strive to satisfy those needs so they can achieve their objectives and the objectives of the organization…” – Ken Blanchard
Copyright 2010 GPAllied©
Most Organizations Are Not Aligned
• According to Harris Interactive Research (2006), only:
– 37% of employees had a clear understanding of what the organization was trying to achieve – 20% were enthusiastic about organizational goals – 20% saw a clear connection between their tasks and organizational goals – 15% felt the organization enabled them to achieve their goals – 15% felt they were in a high trust environment – 10% felt their organization held people accountable – 13% felt there was a high-trust, highly cooperative working relationships with other groups or departments
Copyright 2010 GPAllied©
Process Fragmentation
• The Battle of:
– The “Verticals” vs. the “Horizontals”
Copyright 2010 GPAllied©
Organization Culture Is Driven by 3 Things:
1. Systems
– Performance management, information, training, etc
2.
Structure
– Command and control/directive or team based/self-directed; centralized decisions of import or decentralized decision making
3.
Style of Leadership
– Detached, command and control or engaged and participative
Copyright 2010 GPAllied©
Maturity Continuum
1. Be proactive 2. Start with the end in mind 3. Put first things first 4. Think win/win 5. Seek first to understand, then to be understood 6. Synergize 7. Sharpen the saw
Interdependent
5 6
4 7
Independent
3
1
2
Steven Covey 7 Habits of Highly Effective People
Dependent
Copyright 2010 GPAllied©
The Fleas And The Elephant
• “…If you are not achieving performance objectives blame the system, not the people…” - Deming
Copyright 2010 GPAllied©
Culture: How We Learn It. . .
Copyright 2010 GPAllied©
Managing Culture Change
• “…Culture – what people do when the boss isn’t around…”
- Ian Fife, Shell
Copyright 2010 GPAllied©
An Organization’s Reliability Culture =
• Operators operate and maintainers fix…they are independent functions or • Operations and maintenance work together interdependently to keep the assets in likenew condition so… • “When you push the button, it runs on demand at designed capacity and desired quality”
Copyright 2010 GPAllied©
Production and Maintenance Relationship
Production
I better get out of here before they blame me for the oil leak
Maintenance
Before
From Parker Smith (Eastman Chemicals) - 2004 MARCON Keynote Presentation
Copyright 2010 GPAllied©
Production and Maintenance Relationship, cont’d
After
Copyright 2010 GPAllied©
Managing Change
• Six (6) Factors for Changing Culture:
1. Dissatisfaction with the current state 2. Compelling vision of the desired state 3. Plan of action that will enable movement from current state to target state 4. Engaged Executive Leadership and Workforce 5. Structure for executing 6. Information and Skill management
Copyright 2010 GPAllied©
Stabilize the Changes
• Realign or Develop standards, procedures
• Train people in these, assessing compliance, and measuring conformance • Incorporate standards into:
– Succession Planning, Performance Objectives, ISO 9000 certification, Daily Management System
Install “Reinforcing Systems”
Copyright 2010 GPAllied©
The Leader’s Role in Leading Change
• Recognize the need for change
• Have vision • Inspire • Communicate • Engage
• Set example
Commitment
• Plan / Adapt / Network, build the coalitions
Copyright 2010 GPAllied©
Questions?
Copyright 2010 GPAllied©
About the Speaker
Mike brings 20 years of executive leadership experience with exceptional success developing and executing Business Strategy, Change Management, Organizational Transformations, and Leadership Coaching, and Maintenance and Reliability Excellence for Shipyard and Ships’ Intermediate Maintenance Activities. His specific experience includes: NAVSEA Program Manager for the Navy Enterprise Maintenance Automated Information System (NEMAIS), project reengineering processes for material management, work control, planning and scheduling, budgeting, personnel management, reliability engineering, and operator care for Navy ships’ maintenance throughout all Navy’s SIMAs and Ship Yards from 2000 to 2004. Mike was Program Manager for the NAVSEA Project Management College providing executive oversight on curriculum and delivery to Carrier Availability Project Teams from 2003 to 2005.
Mike Aroney Director, Change Management
EDUCATION MBA MS Education BA Public Administration CERTIFICATIONS Executive Leadership Strategic Planning AFFILIATIONS SMRP AMP CONTACT Mike Aroney GPAllied, LLC 4360 Corporate Rd Suite 110 Charleston, SC 29405 Work: 843-469-5458 [email protected]
He is adept at providing customized solutions to achieve and sustain changes in an organization’s culture, and align the organizational to optimize execution and results of new business approaches for maintenance and reliability. Mike has successful executive experience developing business objectives and strategy, and aligning functional departments to execute and sustain $1.7 billion in revenue. Mike coached and advised senior executive teams, developed strategies and plans and follow-through with coaching and guidance to implement best practices in Reliability Excellence.
He has industry experience with: Alcoa, Century Aluminum, CMC Steel, Novellis, Swagelok, Pfizer Pharmaceuticals, Merck Pharmaceuticals, Johnson & Johnson Ortho, Pearl Harbor Naval Shipyard, Joint Forces Command, Naval Sea Service Command, Madison Metropolitan Water District, Los Angeles Metropolitan Water District, and US Sugar Corporation to name a few.
Copyright 2010 GPAllied©
Ultrasound World VI 2010
Presented by: Mike Aroney
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
And to Accomplish the Mission
Copyright 2010 GPAllied©
Reliability is Critical to a Fighter Pilot
Copyright 2010 GPAllied©
To Land Safely
Copyright 2010 GPAllied©
Maintenance Personnel are Key to Success
Copyright 2010 GPAllied©
What Tool? When? (Right Tools, Right Time)
Copyright 2010 GPAllied©
The Global Opportunity
• GDP
– $46.6 Trillion
• Industrial
– $14.9 Trillion
• Maintenance Spend
– $447 Billion – 1.5-8X OEE multiplier
“It’s Ok to get excited about Maintenance!”
Copyright 2010 GPAllied©
Best Practice Benchmarking
“I could agree with you, but then we’d both be wrong”
1. Chemical Processing 2. Petro-Chem 3. Pulp & Paper 4. Automotive 5. Pharmaceutical 6. Metals & Mining
522 498 468 465 431 430
7. Power
8. Food & Beverage
373
369
Copyright 2010 GPAllied©
Areas of Return
• Cost reductions
– – – – – Labor utilization Contractor costs Overtime Materials cost reductions (inventory/usage) Energy usage
• OEE improvements (capacity)
– Availability – Efficiency – Quality
Copyright 2010 GPAllied©
Reliability Engineering in Maintenance?
Failure modes that no technologie s detect
Maintenance Costs ($)
Equipment on PM (%) Copyright 2010 GPAllied©
Failure Patterns
Initial Break-in period Bathtub
Pattern A = 4%
Time Time
Pattern D = 7%
Wear out
Pattern B = 2%
Pattern E = 14%
Random
Fatigue
Pattern C = 5%
Infant Mortality
Pattern F = 68%
Age Related = 11%
Random = 89%
Source: John Moore Copyright 2010 GPAllied©
Review of Vendor PM Recommendations
New Task 12% Extended Interval 23% Use As Is 38%
Reduce Interval 6%
Delete 21%
Tasks Analyzed
(include 96 new failure modes)
Source: Steve Turner, OMCS International
Copyright 2010 GPAllied©
PM Evaluation Categorize PM Recommendations
PM Task Action Recommendation
Non-Value Added or Reassign to Ops Replace with PdM
# of Tasks
5,876
% of Tasks
29.4%
Man-Hours Represented
23,867
6,437
32.2%
28,222
Re-Engineer No Modifications Required Totals
5,200 2,487 20,000
26.0% 10.4% 100.0%
26,221 8,987 87,297
Source: Allied PM Evaluation at a Steel Mill
Copyright 2010 GPAllied©
PM/PdM Optimization Organizational Impact
FTE Positions
PM Techs PdM Techs Planners Reliability Engineers RE Techs Balance of Crew
Before
43 0 0 0 0 57*
After
17 11 8 2 5 57*
Totals
* Notes
100*
Wrench time @ 28% 35 contractors 18% OT
100*
Wrench time @ 50% 12 contractors 5% OT
Source: Allied PM Evaluation at a Steel Mill Copyright 2010 GPAllied©
Capture Hidden Capacity Crafts Level
Copyright 2010 GPAllied©
• “…Nothing was missing, but we found three more…”
Copyright 2010 GPAllied©
How Do You Get There From Here?
Copyright 2010 GPAllied©
Synergy of “AND” Optimizes Reliability
High
+27%
Business Process and Culture Maturity
• Improved Bottom Line Performance • Lack of System Support
+75%
• Significantly Improved Bottom Line Performance • Practices and Systems Aligned
Baseline
•Informal • Manual Planning Processes • Below Average Business Performance
-7%
• Systems are not Complemented by Effective Business Processes • Significant Inefficiencies
Low
Low
Technology Maturity
High
Source: Brynjolfsson (MIT), Wireman, Troyer, Allied Copyright 2010 GPAllied©
Asset Health Processes
• Management – Efficient
– – – – Proactive Workflow – Planning & Scheduling Material Management Reliability Engineering Operator Care
• Leadership – Effective
– Creating a Culture of Discipline and Execution
Copyright 2010 GPAllied©
Change Management Values
80%
40%
3:4
29%
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
System Variation = Inefficiency
1. Selection 2. Leadership 3. Training 4. Reinforcing System
“We have processes…we just don’t follow them”
Copyright 2010 GPAllied©
Copyright 2010 GPAllied©
If You Have Good:
• • • • • Leadership Alignment Teamwork Change Management Innovation (both shop floor and R&D) You’re in an excellent position to achieve world class performance
– If you don’t have this, it doesn’t matter much what tools you use
Copyright 2010 GPAllied©
LEAN/Six Sigma - Systems Thinking
Leadership is Effective - Actions Act and Influence – “New Thinking and New Behaviors” Management is Efficient - Decisions Decide, Direct and Control – “Unfreeze & Freeze”
Management Tools Leadership People
Processes
Philosophy
Copyright 2010 GPAllied©
Leadership
• “…Leadership- the ability to inspire ordinary people to consistently perform at an extraordinary level…” – Ron Moore
• “…Leadership is an influence process. When you are a leader, you identify the needs of your team members and strive to satisfy those needs so they can achieve their objectives and the objectives of the organization…” – Ken Blanchard
Copyright 2010 GPAllied©
Most Organizations Are Not Aligned
• According to Harris Interactive Research (2006), only:
– 37% of employees had a clear understanding of what the organization was trying to achieve – 20% were enthusiastic about organizational goals – 20% saw a clear connection between their tasks and organizational goals – 15% felt the organization enabled them to achieve their goals – 15% felt they were in a high trust environment – 10% felt their organization held people accountable – 13% felt there was a high-trust, highly cooperative working relationships with other groups or departments
Copyright 2010 GPAllied©
Process Fragmentation
• The Battle of:
– The “Verticals” vs. the “Horizontals”
Copyright 2010 GPAllied©
Organization Culture Is Driven by 3 Things:
1. Systems
– Performance management, information, training, etc
2.
Structure
– Command and control/directive or team based/self-directed; centralized decisions of import or decentralized decision making
3.
Style of Leadership
– Detached, command and control or engaged and participative
Copyright 2010 GPAllied©
Maturity Continuum
1. Be proactive 2. Start with the end in mind 3. Put first things first 4. Think win/win 5. Seek first to understand, then to be understood 6. Synergize 7. Sharpen the saw
Interdependent
5 6
4 7
Independent
3
1
2
Steven Covey 7 Habits of Highly Effective People
Dependent
Copyright 2010 GPAllied©
The Fleas And The Elephant
• “…If you are not achieving performance objectives blame the system, not the people…” - Deming
Copyright 2010 GPAllied©
Culture: How We Learn It. . .
Copyright 2010 GPAllied©
Managing Culture Change
• “…Culture – what people do when the boss isn’t around…”
- Ian Fife, Shell
Copyright 2010 GPAllied©
An Organization’s Reliability Culture =
• Operators operate and maintainers fix…they are independent functions or • Operations and maintenance work together interdependently to keep the assets in likenew condition so… • “When you push the button, it runs on demand at designed capacity and desired quality”
Copyright 2010 GPAllied©
Production and Maintenance Relationship
Production
I better get out of here before they blame me for the oil leak
Maintenance
Before
From Parker Smith (Eastman Chemicals) - 2004 MARCON Keynote Presentation
Copyright 2010 GPAllied©
Production and Maintenance Relationship, cont’d
After
Copyright 2010 GPAllied©
Managing Change
• Six (6) Factors for Changing Culture:
1. Dissatisfaction with the current state 2. Compelling vision of the desired state 3. Plan of action that will enable movement from current state to target state 4. Engaged Executive Leadership and Workforce 5. Structure for executing 6. Information and Skill management
Copyright 2010 GPAllied©
Stabilize the Changes
• Realign or Develop standards, procedures
• Train people in these, assessing compliance, and measuring conformance • Incorporate standards into:
– Succession Planning, Performance Objectives, ISO 9000 certification, Daily Management System
Install “Reinforcing Systems”
Copyright 2010 GPAllied©
The Leader’s Role in Leading Change
• Recognize the need for change
• Have vision • Inspire • Communicate • Engage
• Set example
Commitment
• Plan / Adapt / Network, build the coalitions
Copyright 2010 GPAllied©
Questions?
Copyright 2010 GPAllied©
About the Speaker
Mike brings 20 years of executive leadership experience with exceptional success developing and executing Business Strategy, Change Management, Organizational Transformations, and Leadership Coaching, and Maintenance and Reliability Excellence for Shipyard and Ships’ Intermediate Maintenance Activities. His specific experience includes: NAVSEA Program Manager for the Navy Enterprise Maintenance Automated Information System (NEMAIS), project reengineering processes for material management, work control, planning and scheduling, budgeting, personnel management, reliability engineering, and operator care for Navy ships’ maintenance throughout all Navy’s SIMAs and Ship Yards from 2000 to 2004. Mike was Program Manager for the NAVSEA Project Management College providing executive oversight on curriculum and delivery to Carrier Availability Project Teams from 2003 to 2005.
Mike Aroney Director, Change Management
EDUCATION MBA MS Education BA Public Administration CERTIFICATIONS Executive Leadership Strategic Planning AFFILIATIONS SMRP AMP CONTACT Mike Aroney GPAllied, LLC 4360 Corporate Rd Suite 110 Charleston, SC 29405 Work: 843-469-5458 [email protected]
He is adept at providing customized solutions to achieve and sustain changes in an organization’s culture, and align the organizational to optimize execution and results of new business approaches for maintenance and reliability. Mike has successful executive experience developing business objectives and strategy, and aligning functional departments to execute and sustain $1.7 billion in revenue. Mike coached and advised senior executive teams, developed strategies and plans and follow-through with coaching and guidance to implement best practices in Reliability Excellence.
He has industry experience with: Alcoa, Century Aluminum, CMC Steel, Novellis, Swagelok, Pfizer Pharmaceuticals, Merck Pharmaceuticals, Johnson & Johnson Ortho, Pearl Harbor Naval Shipyard, Joint Forces Command, Naval Sea Service Command, Madison Metropolitan Water District, Los Angeles Metropolitan Water District, and US Sugar Corporation to name a few.
Copyright 2010 GPAllied©
