Drawing up an Asset Management plan that delivers Operational Reliability John Woodhouse CEO, TWPL Chair of Faculty, IAM 1
Who we are Founded 1995 by 8 senior managers from Shell, Philips, MoD, AEA, Kvaerner Now 40 consultants/trainers, each with >20 years of 1 st hand asset management & operational experience Independent, international, multi-industry: clients in 25 countries and most sectors. Path-finders and hand-holders in Asset Management, Operational Reliability & Risk Management Chairmanship of British Standards PAS 55 Chairmanship of IAM Competency Framework project Project Managers for UK Government MACRO & SALVO projects 10 years of MSc delivery in Asset Management Blue chip client list, almost all by word of mouth TWPL provides the grey hair 2
What is (good) Asset Management? Sweating the assets? Maintaining them? Investing in them? 3
Different levels of Asset Mgmt Common perceptions Group/ Corporate Mgmt Asset Management = buying & selling companies Portfolio/network AM Asset Management = maximising sustainable return on investments Business unit/system/region AM Asset creation Asset utilisation Equipment AM Asset care Asset disposal X AM = asset care (maintenance, reliability etc) Optimised life cycles 4
PAS 55:2008 Part 1: Publicly Available Specification (28-point checklist for good practices in Asset Mgmt) Part 2: Guidance 1 st published 2004, updated 2008 50 participating organisations International (10 countries) Multi-sector (15 industries) Over 1300 comments, suggestions & refinements incorporated Restructured, clearer & better illustrated Now moving forward to become full ISO standard 5
Managing the levels in an integrated, optimized way Typical priorities & concerns Organizational Strategic Goals Capital investment optimization and sustainability planning Corporate/ Organization Management Manage Asset Portfolio PAS 55 Asset Management System System Sustained performance, cost & risk optimization Manage Asset Systems Optimize life cycle activities Create /Acquire Utilize Manage Assets Maintain Renew /Dispose 6
Asset Management processes Capital investment decisions PROJECT Mgmt Project Design & Construction CHANGE Mgmt Operating & Maintenance Strategies Materials RESOURCE Mgmt Supply Chain $ $ EVALUATION of Solutions Resource planning & task assignment Labour Root Cause INVESTIGATION CONTINUOUS IMPROVEMENT Inspection & Condition Monitoring WORK Mgmt Work programme scheduling Problem/Opp ty IDENTIFICATION Data Collection Preventive, Detective & Corrective actions Corporate governance
The vital lubricants PEOPLE Understanding & education Motivation Leadership Collaboration & communication DATA/INFORMATION What data, why? Quality, related to criticality Timeliness & availability Usage with knowledge management 8
Getting the best from the current best practices RCM & RBI Function + failure modes + consequences + logic rules = maintenance strategies Quality Management Customer focus + teamwork + data analysis = improvement opportunities IMPLEMENTATION SKILLS Customising + culture impact + home ownership = sustained success RCA & Cost/risk methods Root Cause Analysis, lost opportunity costs + risk assessment = business impact TPM & Org. Change Teamwork + OEE alignment + attention to detail + human issues = motivation & communication 9
Iterative improvements X Effort & results Risk-based alliance contracting Life Cycle Costing & Optimisation Maintenance Strategy Review (RCM, TPM, RBI) 10
Joined-up Asset Management: the biggest challenges 1 Other organizational requirements and systems Legal and stakeholder requirements and expectations (customers, shareholders, regulators, employees, suppliers, society) Organizational Strategic Plan 3 PAS 55 Asset Management System Organizational values, functional standards, required processes 2 Acquire/Create Utilize Maintain Renew/Dispose Asset Management Strategy Asset Management Objectives Asset Management Plans Portfolio of asset systems and assets (diversity of types, criticalities, condition and performance) Continual improvement Performance and condition monitoring Asset Management Enablers 11
Organizational Strategic Plan (OSP) Vision, mission, values, business policies, stakeholder requirements, goals and risk management Organization values, prioritization criteria and risk policy Planning Implementation Functional Policies, Strategies Standards, Processes, Procedures Life Cycle Activities Create/Acquire Utilize Maintain Renew/Dispose Asset Management Policy Mandated requirements, overall intentions/principles and framework for control of asset management Asset Management Strategy Long term optimized and sustainable direction for the management of the assets, to assist in delivery of the organizational strategic plan and apply the asset management policy Asset Management Objectives Specific and measurable outcomes required of assets, asset systems and the asset management system Asset Management Plans Actions, responsibilities, resources and timescales intended to implement the asset management strategy and deliver the asset management objectives Assets Portfolio of asset systems and individual assets 12
Optimized management of the assets and their life cycles 1. Individual intervention optimization Is is worth doing and, if so, when? Construct/acquire Utilize Maintain/modify Replace/dispose Diverse asset needs & opportunities (types, criticalities, condition, performance) 3. Activity program optimization e.g. outage strategy & capital invest. programs, 2. Asset life cycle optimizations What is best mix of investment, utilization, maintenance, lifespan & risk? a) Component/equipment level (life cycles) b) Systems levels (sustainability) 13
Asset Management maturity & development planning 14
IAM s Maturity Scale Learning Applying Embedding Optimising & Integrating Innovating Innocence Awareness Development Competence Excellence nce e Maturity Level 0 Maturity Level 1 Maturity Level 2 Maturity Level 3 Maturity Level 4 The elements required by PAS 55 are not in place. The organisation is in the process of developing an understanding of PAS 55 The organisation has a basic understanding of the requirements of PAS 55. It is in the process of deciding how the elements of PAS 55 will be applied andhas started to apply them The organisation has a good understanding of PAS 55. It has decided how the elements of PAS 55 will be applied and work is progressing on implementation All elements of PAS 55 are in place and are being applied and are integrated. Only minor inconsistencies in application may exist Using processes and approaches that go beyond the requirements of PAS 55. Pushing the boundaries of asset management development to develop new concepts and ideas 15
Assessments & certification against PAS 55 Consistent scoring & maturity scales (IAM: 5 levels) Stakeholder confidence (evidence of good governance) Prioritising & coordinating improvement plans Regulatory requirements Benchmarking etc. 4.1.0 4.6.0 4.2.1 4.5.4 4.2.2 4.5.3 4.3.1 4.5.2 4.3.2 4.5.1 4.3.3 4.4.7 4.3.4 4.4.6 4.3.5 4.4.5 4.3.6 4.4.4 4.4.3 4.4.2 4.4.1 16
Example results from Interactive Assessment AM processes section Innocence Awareness Understanding Competence Excellence Supply chain processes Maintenance processes Projects & Investment Life Cycle Costing Projects & resource prioritisation Major project delivery/completions Minor projects evaluation & delivery Mtce/Ops feedback into projects Risk evaluation & management 17 Now In 1 year In 3-5 years
Building a robust, deliverable plan 18
Top-down & Bottom-up AM directional clarity Direction, criticality & weighted objectives Culture, Attitudes, Motivation, Leadership Enablers Enablers Organisation Design, Training, Communications AM delivery tools A) What is worth doing, when (RCM, RCA, TPM, APT, CI etc.) B) How best to deliver it (EAM, CMMS, CPM, MRP, CRM etc.) 19
TWPL AM Roadmapping process Facts of life (stakeholder expectations) WHY Strategic issues & imperatives Performance & Sustainability goals Roadmap KPI s ROADMAP Criticality & Root Cause Analysis Resources de-bottleneck Critical, treatable underlying issues Interdependencies New requirements Alignment/gap analysis High Value Activities Urgency bands WHEN & HOW Value-for-money bands Costs, Benefits & Confidence Other commitments Legal obligations PAS 55 gaps Scope refocus (value) Efficiency Clustering Benefits Types & Leadtimes WHAT Real projects & opportunities Ideas, initiatives, project proposals 20
Example Asset Management Roadmap 21
Achieving continuity & cumulative success Sensitive linkage #2 Rolling out the next initiative while stabilising/embedding the previous Effort & results Sensitive linkage #1 Exploring a new topic during peak implementation effort for another e.g. LCC methods adoption e.g. Shared risk/ reward alliancing e.g. AM education programme 22
Value Realisation Each IAM maturity step delivered about 10% improvement in total company performance Bottom line impacts O&M savings Life Cycle Cost savings Lower inventory/fixed costs Performance gains Service quality improvements Risk reductions Culture change Ownership & motivation Creativity & continual improvement Credibility Regulatory approvals Customer impression Company reputation 50% reductionintotalopexwithin4years 20% saving in major projectswholelifecosts 25% sustainable savings in spares held 28-50% reduction in planned downtime 60% reduction in safety incidents Priceless! Reductions in regulator challenges/questions Customer satisfaction survey results Tennet networks, Holland 2009 Credit rating, goodwill/brand in balance sheet, M&A values
Every organisation has unique assets & circumstances, so every roadmap is different but it helps if the whole organisation is driving in the same direction! John Woodhouse www.twpl.com john.woodhouse@twpl.com 24