Reliability equipment strategy gaps uncover $11M improvement opportunity in maintenance effectiveness

A global chemicals manufacturer requested an evaluation of its existing maintenance and reliability programs. The objective of the evaluation was to identify fixed-cost improvements. This client aimed to identify specific improvement opportunities of $5 million and beyond.

$5M

Reduction of corrective maintenance cost through improved equipment strategies

$1.5M

Spend reduction on bad actors through root cause analysis

$0.5M

Agile Preventive Maintenance (PM) program based on market and production demands

$4M

Increased availability through improved equipment health

Approach

Equipment strategies are a reliability enabler; however, it is often identified that the installed equipment strategies are insufficient, resulting in ineffective routine maintenance and high corrective maintenance effort despite proactive work being performed. T.A. Cook utilized its unique and thorough analysis methodology to determine potential benefits and create an implementation plan to improve maintenance effectiveness for this chemicals sector client.

During the analysis our experts identified that in the last 3 years, 88% of the maintenance work was corrective due to poor equipment health. Their research also revealed a lack of effective preventive and proactive strategies. This low reliability resulted in an average of 60% mechanical availability with a relatively high maintenance spend. The analysis also indicated that the top 25 bad actors generated a high degree of reactive maintenance work. This reactive work represented an annual average spend of over $15 million. These bad actors represented circa 10% of the overall maintenance spend, out of which rotating equipment carried almost 50% of the cost.

Achievements

With the client’s support, our team was able to identify areas of improvement that would produce tangible benefits in 4 different categories, as reflected in the graphic below. The analysis methodology focused on five key levers, all of which seek to uncover actions with a high impact on increasing maintenance effectiveness.

1.      Reliability vision, plan, and leadership
2.     Organizational structure
3.     Reliability master data, equipment strategies, and bad actor program
4.     Performance management and performance indicators
5.     Reliability (asset care) strategy.

Our team of experts identified a potential benefit of $7 million in maintenance fixed cost reduction through the implementation of a bad actor program and developing agile equipment strategies. Once the core elements are implemented, additional production opportunities in the form of increased equipment availability can be realized in OEE (Overall Equipment Effectiveness) improvements with a minimum estimated benefit of $4 million. T.A. Cook revealed a total benefit potential of $11 million, exceeding the client’s original target by over.

“The goal of reliability analysis is to identify potential benefits and to develop a comprehensive plan to improve maintenance effectiveness by converting maintenance data into actionable information.”

Gerardo Gutiérrez Velázquez, Senior Reliability Specialist at T.A. Cook

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