Agility in manufacturing

July 2005 News

Companies offering the powerful combination of low prices and high quality are capturing the hearts and wallets of consumers around the globe. This trend started in the 1970s and '80s, when Japanese automakers and consumer electronics manufacturers thrived by selling cheaper and initially inferior products that eventually became more reliable than those of the competition, while remaining cheaper. In recent years this trend has migrated to the service industry in a big way with low cost airlines and discount retailers defining new business models for their industries.

It is interesting that the service industry, traditionally extremely flexible, found ways to use technology to tap into the benefits associated with mass production while retaining a high level of flexibility. Manufacturing in turn needs to do the same trick backwards by learning how to be more flexible while keeping costs down and quality up.

During the past century the source of competitive advantage within the manufacturing industry shifted repeatedly. Factors such as cost, production speed, quality and reliability all had their decade of fame as manufacturers kept searching for an edge over the competition. Today, with margins cut razor thin, supply chains optimised, and quality and reliability non-negotiable, flexibility seems the only remaining source of competitive advantage.

Flexibility within a manufacturing environment means being able to change the operation in some way. There are three types of production flexibility:

* Volume flexibility - the ability to vary the volume of product produced.

* Product flexibility - the ability to make different products.

* Mix flexibility - the ability to make a wide variety of products.

Product flexibility means the ability to make new models of products whereas mix flexibility means being able to produce that standard product with a wide range of options. The profitability and very survival of manufacturing firms today depends on the ability to adapt to an unpredictable market environment that might necessitate changes in product design, production volume and product mix.

In today's fickle consumer market, demand shifts might suddenly and unpredictably create periods of high or low demand, or it might necessitate a rapid changeover to a different product line. Such changes can have a major effect on production scheduling, which is also directly affected by the plant's maintenance requirements. Achievement of the required production flexibility thus necessitates a new, flexible approach to asset management.

Reliability centred maintenance

The primary approach to maintenance for the past 40 years has been reliability centred maintenance (RCM). RCM finds its roots in the early 1960s. The initial development work was done by the North American civil aviation industry. It came into being when the airlines at that time began to realise that many of their maintenance philosophies were not only too expensive but also actively dangerous. In the mid-1970s the US Department of Defense wanted to know more about the then state of the art in aviation maintenance thinking. It commissioned a report on the subject, which was titled 'Reliability centred maintenance'. This report is still one of the most important documents in the history of physical asset management.

Contrary to most approaches to preventative maintenance, RCM focuses on function rather than equipment. It governs the maintenance policy at the level of plant or equipment type. In general, the concept of RCM is applicable in large and complex systems such as large passenger aircraft, chemical plant, oil refineries and power stations.

The principles that define and characterise RCM are:

* A focus on the preservation of system function.

* The identification of specific failure modes to define loss of function or functional failure.

* The prioritisation of the importance of the failure modes, because not all functions or functional failures are equal.

* The identification of effective and applicable PM tasks for the appropriate failure modes. (Applicable means that the task will prevent, mitigate, detect the onset of, or discover, the failure mode. Effective means that among competing candidates the selected PM task is the most cost-effective option.)

Within a steady state environment where the expectation on the equipment is constant, RCM has indeed proven very effective. The problems arise when the utilisation requirements change in order to achieve production flexibility.

During periods of high demand, it might be more sensible to keep the plant running rather than stop production to do maintenance, but this would require the use of higher quality lubricants and other consumables in order to ensure extended usage during the high production periods. Conversely, during protracted periods of low production, a low cost maintenance approach might be more appropriate since unplanned breakdowns would not present a serious problem. Mix flexibility might require equipment to be reconfigured, which could influence maintenance requirements. Attainment of such flexibility demands realtime switching between different usage scenarios, which is not possible within a static RCM environment.

Asset Care Plan Developer

To address this challenge, Pragma Products developed the Asset Care Plan Developer (ACPD) as an integrated module of the On Key Enterprise Asset Management System. Its authors believe that this module represents a revolutionary new approach to asset management.

Assets within similar asset types usually have a large percentage of shared components. Setting up component registers for these assets can be both time-consuming and tedious. The ACPD addresses this problem by attaching maintenance tasks to components rather than assets. An asset is then 'constructed' using components drawn from its asset class. In this way, the asset's maintenance schedule is automatically created. When new assets are added they 'inherit' the characteristics of their constituent parts. Only those few components that might not yet be in the system need to be added. Detailed analysis of probable failure causes per asset is also immediately available. This removes a lot of the grind from asset register and maintenance schedule management. The larger the number of assets being managed, the more time can be saved using this tool.

The real power of the ACPD becomes evident when usage conditions change. Each constituent part has different maintenance requirements, depending on the usage scenario. Whenever the usage scenario for a particular assembly line or plant changes, new preventive maintenance schedules are automatically generated based on the requirements of the new scenario. For large plants, a manual changeover process can literally take months and consume huge amounts of resources. Even then this represents the good scenario. The bad scenario is that the plant simply continues to function on the old schedules, running the risk of either under or over maintaining the plant.

At the end of the day this approach translates into a highly flexible manufacturing environment, which in turn affords the organisation quicker response to market requirements and improved capability to differentiate its products in the marketplace. All of this while keeping the plant operating at optimal maintenance levels, thereby keeping cost and risk in check.

For more information contact Louis Volschenk, Pragma Trust, 021 943 3900,,

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