In today`s competitive global environment, the divide that separates success and failure is becoming ever thinner. The `local` advantage has dwindled as firms find themselves competing against multi-national giants.
Through the use of modern communication technology, the falling of trade barriers and economies of scale, these conglomerates are able to break into previously sheltered markets. The opposite is, of course, also true, and for the company that is able and willing to transform itself into a world-class enterprise a whole new market opens up.
One of the few areas in which quantum leap improvements can still be attained is in the area of asset management, with specific regard to asset performance management. In the past, too little emphasis has been placed on the serious adverse effects of neglecting this function. Nowadays plant managers are becoming ever more aware that they are harbouring a wealth of untapped potential within their plant. The phrase `hidden factory` - a factory hiding within the factory, has been coined to describe the extent of this problem. The most common factors that needs to be addressed to unleash plant potential are:
* Low plant availability;
* Inadequate production throughput; and
* A high percentage of non-sellable products due to quality defects.
In order to compete globally, companies have no choice but to utilise their plant assets optimally. This is often referred to as the 24/7 concept - 24 hours a day, seven days a week. Best practices that were relevant five years ago are found not to be suitable for today`s zero defect, zero response time era.
Realising the need for new and improved systems and methodologies in support of improved asset performance. PRAGMA, a South African-based asset management consultancy, has developed and implemented such systems and methodologies with great success at local and international consumer goods manufacturers.
The Asset Management Improvement Program (AMiP), which serves as a best practice framework, can be utilised to grow the maturity of the asset management function through five stages, from firefighting through to excellence.
In support of the AMiP methodology the ON KEY Asset Performance Management System (APMS) has matured to be one of the world`s leading asset performance management systems. ON KEY APMS combines maintenance management functionality with real-time, online monitoring capabilities as well as the analysis tools to translate this data into plant performance measures. The main advantage of the APMS is that it approaches maintenance and production as part of the same reality, which indeed it is. In the past, these two departments used to have separate tools for considering their individual objectives, often leading to conflicting goals while the effectiveness of the overall system suffered.
How did companies like Parmalat realise quantum improvements through the implementation of AMiP and the ON KEY APMS? A typical asset performance improvement project has three distinct elements to it, which can be realistically implemented over a period of 8-12 months, with the first real bottom line savings already occurring in the fourth month. Most of the companies where the system has been implemented reports a return on investment of between 4-8 months.
Once a steering committee and implementation project team has been established, the first element that needs to be addressed is the mapping of the current asset management maturity and determination of the desired maturity. This identifies the improvement gap and is utilised as the baseline for the development of the asset performance improvement plan. The mapping is done at the hand of 13 key performance areas as defined in the AMiP methodology.
The second element that needs to be addressed is the effective measurement of asset performance in order to identify and remove performance barriers. This is accomplished through the ON KEY APMS, which collects data and reports on asset performance. For this PRAGMA makes use of the internationally recognised overall equipment effectiveness (OEE) methodology, which calculates asset performance as the product of asset availability, performance rate and quality rate.
The third element, which is probably the most important, but also the most challenging, is to change the prevailing plant culture. It is imperative to inspire maintainers and operators to work together as a team and take ownership of the assets they operate. These teams must also be educated in the use of root cause analysis techniques in order to continuously remove performance barriers.
The implementation of AMiP has caused many plants throughout SA to dramatically improve their OEEs. Improvements resulted in optimisation of shifts, lowering of production unit cost and increased bottom line profits due to increased production. The success of the AMiP program lies not merely in the production savings, but in the fact that it provides a structured asset management framework within which to operate. The improved asset performance allows management to become more proactive while it also creates enabled and motivated manufacturing teams.
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