Leading asset-intensive organizations continuously heighten their operational efficiency. They actively pursue culture, process, and system changes to drive incremental efficiencies, and as a result enhance the cost-effectiveness of their products and services while maintaining quality.
These three organizations, representing very different industries, share their successes, plans and recommendations so that others can learn from their experiences:
- A manufacturer: Des-Case is a growing, privately-held manufacturer of contamination control products for industrial lubricants headquartered near Nashville, TN. Since its founding in 1983, the company twice moved its manufacturing operations to a larger space and it has established a European presence.
A utility: Inland Empire Utilities Agency (IEUA) provides regional wastewater service and imported water deliveries to eight contracting agencies in San Bernardino County, CA. It consists of five regional plants, a water recycling facility, a composting facility, a desalter, and the administrative headquarters.
The Inland Empire Regional Composting Facility is the nation’s largest indoor biosolids composting facility.
- A transit agency: Metropolitan Atlanta Rapid Transit Authority (MARTA) serves approximately 500,000 bus and rail passengers daily across a 3,376-square-mile service area. In addition to extensive transit system assets, there are 176 buildings to manage.
Their stories illustrate how varying paths can achieve a common goal. Teamwork, process optimization, capital analysis, lifecycle management, remote monitoring, mobility, sustainability, and education are among the initiatives that are meeting with success.
The human element is a primary consideration in the pursuit of operational efficiency. A shared vision and positive, cooperative relationships are essential, both internally and with external providers and stakeholders.
“Top performing organizations are ensuring that the manufacturing and design teams work better with the service team to improve product design and serviceability,” says Aly Pinder, Senior Research Analyst at Aberdeen Group. “Capturing and using data from the field to improve the productivity and performance of future equipment and assets has become a best-in-class capability.”
MARTA embodies the relationship-based approach. “Having good relationships between the equipment providers, engineers, and front-line service providers assures more efficient communications and more effective operations and maintenance (O&M),” explains Remy Saintil, Director of Facilities Maintenance at MARTA. “We also identified synergies between the systems, processes, management, and technology used in MARTA’s different groups and branches in order to eliminate inefficiencies.”
One of Des-Case’s successes involved implementing a PLM software system that bridged with its ERP system, which has brought immediate productivity gains along with planned progressive improvements.
“Many companies struggle with communicating executable actions and goals as it relates to their vision and strategy,” says Jack Spitler, Director of Manufacturing Operations at Des-Case. “The strength of many team members focused on one goal makes for a competitive advantage.”
Des-Case’s teams recently generated a Hoshin tool to align their goals, objectives, actions, and metrics. It serves as a “compass” for the entire organization. “We began establishing this by adopting―as a team exercise―a method of generating strategic planning objectives (SPOs), which were then used to populate and build-out the Hoshin,” adds Spitler. “Not only has this had a tremendous effect on overall communication and a sense of ‘heading in the same direction,’ it has also enhanced the delivery of the metrics and alignment of their appropriate accountability.”
One of IEUA’s most effective system and process changes was its Preventive Maintenance (PM) Optimization Program completed in January of 2014. The program had four target goals, according to Larry Vanderpool, Deputy Manager of Maintenance Planning & Materials Management at Inland Empire Utilities Agency:
- Significantly reduce the volume of PM work orders.
- Move from equipment-based maintenance to system-based maintenance.
- Set up a review and approval process that would scrutinize future PM task changes and additions for validity and consistency with optimized PM tasks.
- Identify equipment, systems, and processes where condition monitoring technologies (e.g., vibration analysis, motor circuit analysis, lube oil analysis, thermography, and ultrasonics) could be leveraged for predictive maintenance, and shift PM tasks accordingly.
“As a result of the PM Optimization Program, we reduced our PM volume from ~26,000 work orders annually to ~7,000 work orders annually,” says Vanderpool. “By utilizing process/system-based and object-based work orders, it logistically focused work on a single area, minimizing travel and virtually eliminating low effort work orders (e.g., less than 30-minute operations). This also simplified time tracking and entry within our enterprise resource planning (ERP) system.”
Online forms were created for IEUA field staff to request changes in PM tasks, but they require supervisor and deputy manager approval. They are also vetted by the Planning Department for historic corrective maintenance, failures, and related cost impacts before any PM tasks are added, modified, or implemented. “This keeps our maintenance tasks consistent and value-added,” explains Vanderpool.
“As for our fourth goal, predictive maintenance based on condition monitoring is now approximately 11 percent of our PM program,” he adds.
A team of internal and independent assessors evaluated MARTA’s assets and their condition to gauge where to focus attention.
Tremendous capital expenditures have to be prioritized and optimized for operational efficiency. MARTA, for instance, has 54,000 assets inventoried. “We use an enterprise asset management (EAM) system to track attributes such as equipment condition, priority, age, expected useful life, and the cost of replacement,” says David Springstead, Sr. Director of Engineering and Development at MARTA. “With that data, we built a Capital Program with prioritization criteria that address risk, sustainability and environmental issues, because there’s not enough money to fix everything.”
A team of internal and independent assessors evaluated MARTA’s assets and their condition to gauge where to focus attention. “With better data in the EAM system, we have been able to lobby for more funds and get quicker management buy-in for asset maintenance and replacements,” explains Springstead. “Even our large-scale projects are getting approved quicker and without pushback.”
One of Des-Case’s successes involved implementing a product lifecycle management (PLM) software system that bridged with its ERP system. “This has brought immediate productivity gains along with planned progressive improvements, some recognized since the launch and others still in the development phases,” says Spitler. “We previously had an ever-increasing amount of manual activity surrounding our control of bills of material (BOMs), routings, document control, communication loss, and overall resource time allocated to manage these.”
Remote monitoring and control
|Best-in-class companies allow audits to be conducted on a worker’s mobile device.|
According to Aberdeen’s Pinder, manufacturing firms have leveraged remote monitoring of assets and resources in the field as a means to:
- Develop or transition to a predictive/preventive maintenance model
- Trigger the scheduling of service visits
- Alert the service organization of an equipment/asset failure or downtime
- Monitor the condition of assets
- Monitor asset usage
- Provide customers with self-service information
- Develop new revenue-specific service business models (e.g., pay per use)
- Improve product design
“Our facility maintenance is geographically spread out,” says Rich Krisak, Chief Operating Officer at MARTA. “It requires a lot of travel time to get around between the sites, whether it’s our bus or rail operating facilities, Class A professional buildings, police substations, or other locations.”
“We make use of technology to monitor and control MARTA’s facilities remotely, which provides great labor efficiencies and cost savings because we’re sending fewer bodies to the various locations,” adds Saintil. “For instance, our HVAC systems have software incorporated so that we can monitor all locations from a single site. We bid that project out and found a solution that translates all of our different HVAC systems (Carrier, Trane, etc.) into one language, so we can troubleshoot conditions and diagnose problems before sending out a technician. This has saved us a tremendous amount of time.”
Mobile devices used by service technicians are being incorporated onto the plant floor. “Manufacturing firms are using mobile tools to provide service technicians with work-related information in real-time; enable tracking of technicians, parts, and vehicles in real-time; and establish systems and metrics to track service performance,” explains Aberdeen’s Pinder. “These advancements have led to improved data integration between field and back-office systems. Also, this enables better planning for future service demand as they have a better view of equipment performance and service resource capacity.”
MARTA is among those using mobility to enhance operational efficiency. “We implemented a system to monitor the performance of job functions and standardize work processes,” says Saintil. “For example, our station janitors use a handheld device that provides detailed work instructions so they know exactly what they need to do. It also allows us to monitor their time spent working vs. on breaks.”
Another area that benefits from mobility is the execution and management of audits. “Best-in-class companies allow audits to be conducted on a worker’s mobile device,” remarks Reid Paquin, Research Analyst at Aberdeen Group. “This provides efficiency gains by eliminating traditional paper-based auditing systems and the need to go back to work stations to turn in the results. Also, conducting audits through mobile devices gives workers a standardized platform to work on, which is much easier to use.”
Since operational efficiency comes from doing more with less, energy and water cost savings are another prime opportunity. “We reconstructed our energy management at MARTA, which lowered our utility bills,” says Springstead. “We proved to our utility that we have load response capability. Because we can drop our energy load on demand, it qualifies us for a better rate using real-time pricing, which is saving us from $2.7 million to $4 million annually.”
LED replacement lights are being installed throughout MARTA because of their longer life, lower energy consumption and better quality output.
LED replacement lights are being installed throughout MARTA because of their longer life, lower energy consumption and better quality output. “We are starting in places that are difficult to maintain,” explains Springstead. “Having LED lights throughout our 9.1 miles of rail tunnel beneath the city, for example, is saving us a lot of money and making work safer for the operators, track walkers, and maintenance personnel.”
“Our newer buildings are all LEED certified and we are integrating LEED design principles in our existing building renovations,” adds Saintil. “We also identified two million gallons of wastewater at two facilities that qualify MARTA for credits from the City of Atlanta. Up to 90 percent of the water used for washing our trains and buses is reclaimed, filtered, treated and reused through a vehicle washer reclamation system, rather than washing down the drain.”
IEUA is currently working on a maintenance competency based training program. “One of the main issues facing maintenance departments nationwide is succession planning and locating qualified personnel. In the next five to ten years, we will be potentially losing 35 to 40 percent of our maintenance staff due to retirements,” says Vanderpool.
“Competency based training will enable entry level personnel to learn maintenance and become well rounded in multiple crafts and technologies. We will leverage the journeymen and technical professionals currently available as well as manufacturers and college classes,” adds Vanderpool. “This, coupled with a competitive wage and an organizational structure that supports advancement opportunities, will help to minimize the adverse impact of future succession issues.”
Training is also a priority at Des-Case. “We will continue to develop and invest in our team members, and further develop and identify the metric tools that allow for efficient and effective change as well as support a direct impact to our profit margins,” says Spitler.
Efficiencies on the horizon
Des-Case’s Continuous Improvement Program is continually evolving. “We are always improving upon and developing tools that sustain our efforts and we continue to identify and eliminate waste, not only in manufacturing, but administratively as well,” explains Spitler. “These initiatives will help us to maximize our resources, continuously improve our lead in the market, and deliver quality products and services.”
“We are currently investigating the opportunity of utilizing our PLM system to help manage our efficient consumer response (ECR) system, with the expectation of reducing our current resource time and improving our response time and traceability,” adds Spitler.
IEUA intends to better leverage technology and available information. “We plan to move to mobile tablets and away from the printed work order. This will increase access to O&M manuals, BOMs, online catalogs, and the most current as-builts and engineering documentation,” says Vanderpool.
“We will leverage our ERP financials in concert with an enterprise SCADA historian to look at the total cost of ownership for making better business decisions. This will also enable a move from time-based PM maintenance to a usage-based maintenance program,” adds Vanderpool. “In addition, we will more effectively utilize our geographic information system (GIS) to support our linear/spatial underground assets.”
MARTA is the only transit agency to pursue ISO 55000, the new international asset management standard, with a grant from the Federal Government. “We were already relatively close to compliance due to our asset management maturity level, and now we are extending our compliance from tip to tail,” explains Springstead.
Companies striving for operational efficiency can learn much from these leaders. “Improving operational efficiency begins with recognizing that technology alone is not the answer; rather, we recommend focusing on building and empowering a smart, trustworthy team,” says MARTA’s Krisak. “We also suggest addressing communication errors by streamlining the organizational structure, collocating vendors and internal staff for the duration of specific projects, and employing a ‘systems approach’ to addressing industry, stakeholder, and user-driven needs.”
“Organizations need to break the silos of data,” advises Aberdeen’s Pinder. “Insight from field service is invaluable for other functions within the organization and must be accessible to teams.” He also recommends eliminating the paper. “Paper-based systems are generally labor intensive and susceptible to user error, and the efficiency gains by automating your processes can really add up over time.”
IEUA’s Vanderpool suggests a multi-pronged approach to operational efficiency:
- Know the assets you own
- Know the condition of those assets with PM and rehab plans as needed
- Review and refine your existing PM program:
- Remove any tasks that do not add value
- Understand that run-to-failure is a valid maintenance strategy
- Refine your planned work order time as needed based on the historical actual task time
- Leverage condition monitoring technologies as much as possible
- Utilize and train your planning/scheduling staff by developing key performance indicators and goals that will challenge them
“Develop a strong vision, mission, values, and overarching strategy,” recommends Des-Case’s Spitler. “Having these will encourage a singular approach when introducing, improving or creating new tools, systems and processes to drive the metrics each company finds essential to support cost, quality, delivery, safety and morale.”