This is the second article in a three-part series on contract MRO services. Part I of this series explained the elements for success that must be present for maintenance tasks to be completed successfully, while this article grapples with the timing, planning, scheduling, and communication required to put these elements in place. In Part III, inventory management will be addressed.
Subcontracting maintenance work can be a good idea, providing exciting results that translate well at the bottom line. Some organizations have shown a 95% reduction in unplanned repairs when equipment condition is covered by vibration monitoring and results are published to the right parts of the organization, says Burt Hurlock, CEO of Azima DLI (www.azimadli.com).
Contractors can add capacity when it’s needed. They can add skills that an organization doesn’t use often enough to keep on staff. They can provide equipment that the firm doesn’t use enough to justify a purchase. But every subcontract brings with it two things that must be managed — a cost premium and an additional communication link.
Cost is a straightforward management issue. Subcontracting can provide the right equipment and the right specialists without creating the need to pay for them year-round. They can also provide the capacity needed to make the best use of shutdown time without the need to constantly carry enough staff for a turnaround. The cost avoidance or reduction provided by MRO support must offset the cost premium for subcontracting. Cost is important, but it is well understood by most of the organization.
Communication is the more difficult issue to manage, says Hurlock. “We’re in trouble when the customer doesn’t respond to information, or when he says, ‘I can’t resolve these conflicts; you fix it.’“ Information needs for contractors are the same as those for in-house teams, and the same tools and behaviors must be used to manage them.
“Three primary components must be present in order to successfully subcontract a maintenance program,” says Jack Ecktman, program manager, storeroom & reliability services, at Rockwell Automation (www.rockwellautomation.com). “The first and most important is the full support and commitment to the success of the program from executive level management. The second is a thorough understanding of the subcontracted activities’ value proposition, both in terms of hard financial benefits and softer value-added benefits. Finally, there must be a clear and definable scope of work, clearly defined roles and responsibilities and appropriate performance measurements, such as specific goals or clearly defined key performance indicators (KPIs).”
There it is — management ownership, a solid financial case for the contract and clear instructions and measurements to cement communication between contractor and client. To make MRO contracting work, these requirements must support the elements for maintenance success.
Management ownership: Each of the elements for maintenance success has an owner. Equipment availability and production support for maintenance are both owned by the production staff. If assets are to be available for condition monitoring and production staff need to be on hand to support maintenance, production managers must make them available. Not only must they be on hand, they must be on hand in accordance with an agreed-upon maintenance schedule. This must happen even if a temporary sacrifice of production is required. Only top management can lay down the strategy for this sacrifice to take place. Top management must also set the strategies for the materials operation to cooperate with maintenance and production so that maintenance materials are on hand at the right time and place for maintenance to occur.
It’s very often true that procurement operations don’t have a close reporting relationship with production and maintenance. Again, it may be that only top management can make this coordination happen. Work instructions and task lists must also be in place, usually provided by the maintenance planning function and engineering. Most of this information should be standardized and stored in the computerized maintenance management system (CMMS) so that it need not be developed for each work order, but it must still be updated and made available in accordance with the schedule.