Tracking plant performance with an asset management report card

A key management tool for organizations of any size is an asset management report card (or scorecard, health check, or audit) completed at least annually. The report card can be a useful snapshot of how an organization is doing, as well as tracking trends over time and possible root causes for any major changes. It also can be used to benchmark how an organization is doing relative to others within the same corporation, and/or external companies.

Below is an excerpt from hundreds of questions that I have used or come across in reviewing various asset management organizations. A sampling of questions is provided from four key areas: strategy, performance measures and targets, work planning and scheduling, and spare parts inventory control. However, there are many other areas for which simple checklists can be developed and administered in-house, or by a third-party.

Note that the optimal answers to the questions below are not necessarily obvious. For example, what is an acceptable level of overtime, or the best supervisor:mechanic ratio, or the right number of inventory turns for your organization? This will depend on the size of company, industry, location, capacity utilization, seasonality, and many other factors. But coupled with a benchmarking exercise, and by monitoring your report card at least annually, you can achieve the key objective: to identify, prioritize, track, analyze and incent significant improvement opportunities over time.

Asset management strategy

1. The strategic business unit (SBU) has a strategy outlining its requirements for success over the next 3-5 years.
2. The vision, mission, values, goals, objectives, performance measures and targets, and action plans are clearly defined for the SBU using a balanced view of the organization.
3. Asset management is included as a top priority in the SBU’s strategy.
4. Senior management is actively involved in spreading the strategy throughout the organization, including any asset management component.
5. The SBU strategy is well known throughout the organization.
6. The SBU strategy is well understood throughout the organization.
7. Levels of the SBU organization involved in the development of the strategy:
   
   • top/executive level
   • senior site management
   • middle management
   • front line supervision
   • technicians.
8. The maintenance department and those responsible for asset management are kept informed/involved in changing business initiatives, strategies, long and short-term plans.
9. The asset management organization has a clearly-defined strategy that is linked to the SBU’s overall strategy.
10. The asset management strategy is well known throughout the maintenance, engineering, and operations organizations.
11. The asset management strategy is well understood throughout the maintenance, engineering and operations organizations.
12. Levels of the organization involved in the development of the asset management strategy are:
    
    • operations
    • top/executive level
    • senior site management
    • middle management
    • front line supervision
    • planners
    • purchasing
    • stores personnel
    • technicians
    • engineers
    • others.
13. Action plans are defined and documented for long and short-term improvement initiatives to close gaps against the asset management strategy.
14. Action plans are in progress to support the asset management strategy.
15. People are being provided sufficient resources to successfully execute against the performance measures and targets.
16. Goals have been established for employee health and safety, quality improvement, reliability improvement, downtime reduction, productivity, storeroom management, utilities, and other relevant areas.
17. The attitude within the asset management organization is supportive of improvement and change.
18. Communication within the asset management organization is open, effective, frequent, and two-way to ensure multi-departmental cooperation, idea sharing, and basic teamwork.

Performance measures and targets

1. Asset management performance measures and targets include a wide range of indicators covering the following areas:
   
   • safety
   • productivity
   • total cost of ownership
   • equipment availability and utilization
   • equipment reliability
   • equipment performance
   • quality
   • others.
2. A performance scorecard exists for the:
   
   • site
   • maintenance department
   • operations department
   • engineering department
   • maintenance manager
   • maintenance supervisor
   • technicians.
3. Performance scorecards are:
   
   • posted and updated regularly
   • posted with goals only
   • not posted
   • do not exist.
4. Asset management goals, and organizational performance relative to them, are known by:
   
   • manager levels
   • maintenance support staff
   • technicians
   • operations
   • engineering.
5. Maintenance labor and material costs are reported:
   
   • monthly
   • weekly
   • daily
   • reviewed against previous costs (e.g., same period last year)
   • reviewed against budgeted costs (e.g., original/revised budget)
   • reviewed against planned costs
   • evaluated against trends (e.g., using control charts).
6. Overtime is:
   
   • _______ % discretionary
   • _______ % built in (chronic?).
7. Account performance:    Last Year        YTD    
   
   • labor
   • overtime
   • operating supplies
   • contracted service
   • parts
   • R & M
   • utilities
   • downtime.
8. Utility usage performance is tracked:
   
   • gas: BTU/ton YTD  _______ 
   • electrical: KWH YTD  _______ 
   • water: gallons YTD  _______ 
   • other.
9. The organization is actively managing energy demand in light of well-known climate change goals.
10. Percent of asset management costs for contract services:  _______ 
11. Equipment downtime attributable to maintenance (e.g., breakdown) is monitored, including:
    • Costs are known for each piece of equipment and system.
    • Costs are known for each piece of critical equipment.
    • Costs are used to measure improvements in availability.
12. Realistic labor performance standards are:
    
    • developed
    • used for all planned work
    • used for recurring tasks
    • developed but not used
    • not developed.
13. Maintenance labor performance is:
    
    • reported monthly
    • reported weekly
    • evaluated against standards
    • used to update standards
    • not measured.
14. Craft utilization is:
    
    • reported monthly
    • reported weekly
    • evaluated against standards
    • used to balance skill levels
    • not measured.
15. Work sampling studies are used periodically to evaluate performance and the nature of delays such as waiting for parts, equipment, tools, instructions, training, and poor planning.
16. The effectiveness of maintenance planning is evaluated by:
    
    • % planned work orders
    • compliance to schedule
    • equipment performance
    • work order backlog.
17. Tracking systems exist for:
    
    • startups/changeovers (e.g., late, total time, frequency)
    • output/labor hr
    • overtime
    • schedule compliance
18. Asset management measures and targets are a regular topic in team meetings.    

Work planning and scheduling

1. Percent work done through use of a work order:
2. Work order priorities are:
   
   • not used
   • fixed
   • reviewed and updated on a regular basis.
3. Work order priorities are based on:
   
   • safety
   • quality
   • equipment criticality
   • downtime costs
   • other factors.
4. A written procedure that defines the origination, authorization, and processing of all work orders is available and understood by maintenance and operations departments.
5. The responsibility for screening all work orders lies with the:
   
   • planner
   • maintenance supervisor
   • maintenance manager
   • technician
   • operations
   • one single point of responsibility.
6. Work orders are given a priority classification based upon an established prioritization system.
7. Work order planning is done by:
   
   • planner
   • maintenance supervisor
   • maintenance manager
   • technician
   • no planning occurs.
8. Work order planning includes:
   
   • priority ranking and labor requirements
   • pre-kitting plans for all major jobs
   • technical documentation.
9. Work order planning covers:
   
   • all work orders
   • scheduled downtime only
   • major jobs (> 1 shift).
10. Scheduling of workforce is best described by:
    
    • All shifts are pre-scheduled each day.
    • Work assigned as technicians become available.
    • Some work is pre-scheduled.
    • No formal scheduling is used.
11. Schedules are issued:
    
    • each shift
    • daily
    • weekly
    • never.
12. Schedule compliance goals:    
    
    • A goal is set and on target.
    • A goal is set and within 20 % of target.
    • A goal is set but performance not tracked.
    • No goal is set.
13. Setups and changeovers are coordinated with maintenance to allow for scheduling of selected repairs, inspections, and services such as lubrication during scheduled downtime.
14. Shift change objectives:
    
    • no set objectives
    • schedule changes and downtime issues
    • progress with carryover work
    • product quality issues.

Spare parts inventory controls

1. The inventory system provides an accurate and complete record of information for each stock item at any given time of the year.
2. ABC classification of stock items has been done and proper storage methods and accountability is established for each class.
3. “A” and “B” items have valid re-order points, Economic Order Quantity (EOQ), lead time, and safety stock established for each.
4. “C” items are approximately 50% of stock items with 5% of total inventory value, and are identified and use a two-bin system or floor issue (e.g., nuts and bolts).
5. Primary responsibility for the stockroom lies with the:
   
   • stock-keeper
   • maintenance technicians
   • maintenance supervisors
   • contractor.
6. Stock issuance procedures cover the following % of parts in the stockroom:
   
   • 100-75%
   • 75-50%
   • 50-25%
   • less than 25%.
7. Inventory accuracy is determined by an effective cycle counting program based on what frequency:
   
   • weekly
   • monthly
   • quarterly
   • semi-annual
   • annual.
8. Inventory accuracy is at the following average level:
   
   • > 95%
   • 90-95%
   • 80-89%
   • 70-79%
   • < 70%.
9. Inventory turn rate:  _______ 
10. Average percent stockouts or service level:  _______ 
11. Total value of inventory:  _______ 
12. Total value of critical parts:  _______ 
13. Percent of inventory not moved in 12 months:  _______