PDF - Millennium Steel

Maintenance in the new millennium
worldsteel (formerly IISI) has reviewed worldwide steelworks maintenance philosophy and
practices with the aim of helping steel companies implement efficient and effective maintenance
systems so as to enhance operational practices. This article provides a brief overview of context,
approach, results and conclusions from this benchmark study.
Author: Kees Tol
Corus/worldsteel
T
ECHCO (Technology Committee) of worldsteel selected
maintenance as the subject of a new project at TECHO36 in 2004. The underlying aspects for this decision were:
`Maintenance is crucial to successful steelworks
operation and important as a subject of sustainable
development of the steel industry
A
` previous study on this subject, issued as the report:
“Maintenance for the 1990s” in 1989, took place more
than 14 years earlier, hence it would be an appropriate
time for TECHCO to re-look at maintenance
` The situation of the steel industry, technologies and
equipment used have changed significantly and also
greatly improved since the last study
` Maintenance is the third highest cost item after raw
materials and manpower (8-15% of turnover, of which
approximately half of this cost is for manpower).
GOAL AND SCOPE OF THE PROJECT
The main goal was to help steel companies implement
efficient and effective maintenance planning and practices
so as to enhance operational practices.
The scope of the project was to:
`Benchmark maintenance performance indicators for
steel production processes
` Develop an understanding of what is needed to
achieve efficient and effective maintenance in terms
of technologies used; and strategy of maintenance
management (eg, methods to reduce cost and further
improve equipment performance)
` Identify state-of-the-art technologies and best practices
`Provide a reference manual for improvement.
MILLENNIUM STEEL 2009
THREE PHASE APPROACH
Phase 1: Survey of maintenance (equipment
performance) The first phase of the project concentrated
on a quantitative survey of maintenance across the global
steel industry. Data from 2004 was requested.
A comprehensive questionnaire was developed, consisting
of six main sections:
1Facility characteristics
2Facility manpower
4Process performance – productivity
5Process performance – rate and quality
6Maintenance cost
7Maintenance maturity assessment.
Participants were asked to complete the survey at a facility
level. For each facility (eg, BOS plant, coke ovens, blast
furnaces) a separate survey was requested. For each site
one works-level survey was requested which included the
entire site.
The survey was developed as a web application by
BlueScope Steel, and hosted on a project-specific IISI
website. A detailed guidance document was prepared to
assist participants and provide detailed instructions and
question clarifications. All of IISI’s members were invited
to participate in the study, and those who expressed an
interest were issued with their own unique username and
password to access the website. The site was designed
so that it was not possible for one project participant to
access data entered by another. When the database was
frozen, information had been provided by 28 organisations,
covering 53 sites and 655 individual facilities.
Phase 2: Maintenance strategy and technology
The main project team formed a subgroup to develop a
comprehensive questionnaire covering the main elements
of maintenance strategy and technology. It consisted of
564 individual questions, and included a greater number
of qualitative questions and questions requiring a free
text response.
The survey was divided into four sections:
1Costs, maintenance effectiveness, plant performance
and external constraints
2The two components of maintenance effectiveness,
maintenance strategy and maintenance efficiency
3Design for maintenance
4Change management in maintenance.
As in phase 1, the survey was developed as a web
application by BlueScope Steel, and hosted on a project
specific IISI website. A detailed guidance document
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Introductory Themes
r Fig 1 Extract from equipment performance dataset
was prepared to assist participants and provide detailed
instructions and clarifications. All of the participants in
phase 1 were invited to participate in this study. When the
database was frozen, information had been provided by
23 organisations, covering 64 sites and 7 sub-sites.
Phase 3: Maintenance contractors and partners
The main project team formed a subgroup to develop
a short questionnaire asking partners and contractors
for their views on the maintenance process and their
relationship with their steel industry customer base.
The questionnaire was divided into four sections:
1About the organisation
2Scope of maintenance services provided
3Reasons for using contract maintenance services
4Contracting success factors.
RESULTS
r Fig 2 Example data output graphs and tables
a
MILLENNIUM STEEL 2009
Equipment Performance (phase 1) The survey covered
75 data items of 655 individual facilities. The first step in
the analysis process was to identify and eliminate outliers.
Organisations whose surveys contained apparent outlying
data were contacted seeking clarification, and outliers for
which no explanation was obtained were eliminated from
the dataset. What remained was still a huge amount of
data. (Figure 1 illustrates just a small part of the database).
To analyse this data and to identify the best performing
facilities in each group the 75 data fields were reduced to
nine key indicators and normalised to compare results:
1Availability = (Annual calendar time – losses)/annual
calendar time
2Average maturity = Average of self-assessment of five
maturity factors
3Cost Index = Facility maintenance cost/liquid steel cost
of steel processed in facility
4Manpower/tonne = Manpower full-time equivalent
(FTE)/facility production
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Introductory Themes
members with a framework to improve on.
r Fig 3 Hybrid maintenance model
MILLENNIUM STEEL 2009
5Unplanned delay rate = Unplanned downtime/available
time
6Reliability = (Scheduled time – unplanned downtime)/
scheduled time
7First pass yield = (Total production – quality losses)/
total production
8Uptime = Run time/calendar hours
9Maintenance ratio = Maintenance downtime/available
time
Indicators 3 and 4 were used to compare the results with
the 1987 study. The complete set of indicators was used
to review the performance of the top performing facilities.
Results were presented as ranking tables and spider graphs
to show the performance of a specific facility relative to
the top, average and poor performers within a facility
type (see illustrative data in Figure 2). Participants were
provided with an IT tool to allow them to undertake their
own benchmarking and gap analysis based on the data
collected.
Results on maintenance strategy and technology
(phase 2) The phase 2 questionnaire consisted of 280
questions, and in resulted in 18,348 answers from member
companies. The approach used to determine findings on
this data was to:
`Develop a maintenance model that represented our
hypothesis for maintenance in the new millennium
including the purpose of maintenance and all the
elements of maintenance and steps to improve
maintenance
` Test our model against the site data and interpret the
results
` Develop a set of recommendations and utilise an
updated model to illustrate the finding and provide
The project team elected to identify the essential elements
of asset management and to examine the models and
frameworks used in contributing organisations that provided
the connectivity and purpose for the individual elements.
To simplify the problem, the team looked to adopt a
leading practice example from one company or consultant
that could represent the hypothesis for maintenance in
the new millennium. Member companies could then be
compared to the selected model.
An ideal maintenance model and subsequent
improvement methodology had to be capable of delivering
the following:
`Greater business focus
`Manufacturing focus
`Business cost reduction
`Efficiency and effectiveness
`Clear maintenance purpose
`A definition of the elements of maintenance
`An illustration of the maturity steps to improve
maintenance
` Emphasis on the role of maintenance as more than a
cost to be minimised
Ten maintenance models were collected. These included
three external models presented to the team by consultants
and two cross-models from other industries (aviation and
mining). It was determined that as each individual model
had been designed with a narrower purpose in mind,
most missed some of the basic criteria described above.
It became clear that a hybrid model could be created that
better met the criteria.
To accomplish this, efforts were made to clearly identify
the essential elements of maintenance from each of the
company models, and the steps required to improve
maturity.
The resulting hybrid model (see Figure 3) describes
five levels of maintenance process maturity, categorising
maintenance processes into broad components. This
additional dimension was aimed at illustrating steel
industry maturity.
To apply the considerable data set to the hybrid model,
survey questions were grouped around elements of the
model. Once grouping was complete, score criteria were
developed so that a simple traffic light (red, yellow, green)
score could be assigned to each question. The grouping
allowed member company data to be mapped to the
model. It was also possible to visualise averages by region
and the profile of top performing companies. This method,
visualising strengths and opportunities for improvement,
provides a simple one-page summary of performance in all
elements based on many data points.
aa
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r Fig 4 Results of using vibration analysis by equipment and region
MILLENNIUM STEEL 2009
r Fig 5 Example detailing reasons for contracting
Insights gained from examining regional variations in
processes included:
`All respondents have some higher maturity activities
underway, ie, predictive rather than fire fighting
` All respondents struggle with asset management
policy and direction setting, while agreeing it is a
fundamental element
` All respondents want to improve their ability to
generate and review maintenance strategies (or asset
strategies at some companies with higher maturity
activities)
` Asian companies are ahead in failure analysis. Asia was
the only region scoring green in this section which may
represent a long history of failure analysis techniques
ingrained in the improvement methodologies of many
Asian companies.
` Companies in every region except ‘emerging’ want
to improve planning, scheduling and work execution.
This is despite the fact the issue has been studied for
a number of decades and that it was highlighted as
a major point in the 1987 study. It is interesting that
opportunities still seem to exist in this area after so
much attention.
TECHCO requested that the project team report on
advances in maintenance technology such as condition
monitoring techniques. A significant number of phase 2
questions covered this subject and have been analysed in
detail. Participants were asked about the adoption and application of these techniques (such as vibration monitoring, ultrasonic analysis, acoustic emissions and oil particle
monitoring) at their facilities. Although not all techniques
are used by all companies, it is clear that this type of analysis is now being undertaken routinely to proactively understand process and equipment condition. Variations between the geographic regions exist. Simple vibration and
oil moisture monitoring are the techniques most widely
used, possibly due to their cost-effectiveness, ease of use
and interpretation. Figure 4 shows the results of using vibration analysis by equipment and region.
Results on maintenance contractors and partners
(phase 3) Early in the project the team recognised that
there had been a major increase (18-29%) in the use of
contractors since 1987. The team decided to produce a third
questionnaire specifically focused on contractors and their
partners, to be answered by the contractors themselves.
Internal labour has been reduced to decrease business
costs. Various contracting agreements have been explored
to counteract rising labour costs, meet flexible labour
demand and to increase utilisation. Contractors can be
deployed where the work is across a site, providing greater
flexibility. It may be easier for companies to use contractors
to do this rather than their own employees. In addition,
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Introductory Themes
use of contractors allows a company’s own personnel to
focus on core activities.
Greater use of contractors, however, requires an increased
planning and scheduling capability in companies to be costeffective and, although contracting is not strongly used in
all regions, effective contract management remains key to
becoming a low cost operation. Figure 5 shows one example
of the results in the report detailing reasons for contracting
from both the steel company and contractor perspective.
LINKING STRATEGY (PHASE 1) AND
PERFORMANCE (PHASE 2)
ROLLING MILL BUSINESS MODEL
APPLYING THE ROLLING MILL
BUSINESS MODEL
It is important to look at the model in the context of
the results of the study: phase 1 looked at performance
and effectiveness, while phase 2 looked at strategy. Each
reporting site has been analysed to determine how they
set the roll gap, that is, the strategies they used to deliver
their 2004 performance output. Performance, or output,
is known for each facility and site that contributed, as
are the strategies deployed, and how effective each site
believes they are at delivering them. This is illustrated in
Figure 6.
Companies can set their own improvement targets by
comparing their performance with that of a best performer
in any facility group. This enables them to set their target
gauge. The lower roll can then be set, as they know what
they want, and what the best looks like, and can use this
information to help develop strategy and position the
roll. Finally they can set the upper roll by looking at the
maintenance model and what aspects of execution the
r Fig 6 Rolling mill business model
Product output relates to delivering
manufacturing objectives (safety, overall
equipment effectiveness, etc)
Slab feedstock represents operating cost: – assets
– employees
– materials
– knowledge
Lower supporting roll represents strategy
on two levels: business and facility (what
to do)
Upper roll represents execution of processes to deliver strategy, effectiveness
and efficiency (how to do it well)
Thickness gauge represents the feedback
loop of continuous improvement, ie,
continuous review of performance and
refining maintenance approach based
on outputs from the ‘best performers’ as
determined in phase 1 of the project.
a
MILLENNIUM STEEL 2009
A simplified model (see Figure 6) was developed,
illustrating the findings of the study based on a rolling mill
analogy. The maintenance process is portrayed as a rolling
mill so people, especially non-maintenance managers, can
understand it better. It is simple but designed to illustrate
the importance of strategy and the need for efficient
execution. A rolling mill cannot produce its product unless
both bottom and top rolls perform correctly and are
synchronised. This is the same for the asset management
process if it is to deliver business benefit.
It is likely that the system will be not be fully optimised
the first time it is used, so a feedback capability is necessary.
A measure is needed, and the feedback loop linking the
ouput thickness gauge and rolls represents the continuous
improvement process. This can re-adjust the rolls, realign
the strategy or concentrate more on the efficiency of
execution, corresponding to a continuous review of
performance and refining of maintenance approach.
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Introductory Themes
r Fig 7 Performance gap analysis
best performers focus on. The model was designed to
help people, especially managers and non-technical staff,
clearly understand the findings of the study.
Together with phase 1 and phase 2 results they can
undertake a gap analysis to highlight areas for improvement
and setting new aspirational targets, after which they can
adjust their strategy to realise them (see Figure 7).
MILLENNIUM STEEL 2009
CONCLUSIONS
The main conclusions from the full report are:
`There are pockets of excellence in all areas of
maintenance activities, however, no one organisation
or integrated site is good in every facility
` The basic elements of maintenance work management
are the same as in 1989:
– work management (planning, scheduling, execution
and review)
– an understanding of monitoring and advanced
techniques is known, but not generally practised
W
ork
management is now seen as a foundation for
`
effective asset management. In the 1990s maintenance
was functionally biased – the engineering function
owned maintenance. Today, maintenance is more
aligned with business needs, and often maintenance
no longer sits in the engineering group.
` Although seen as another foundation for effective
maintenance, top performing facilities still consider
that they have to improve in developing and aligning
strategy with business goals
A
` corporate policy for asset management is required
to enable the facility level to develop their facility
strategies
` In 1989, the choice of maintenance management
system was an issue. Today, this is part of an enterprise
resource planning system.
` In 1989 maintenance and operations were separate
– with maintenance aiming to maximise equipment
reliability, whether needed or not. Today it is about
net operating time with operations and maintenance
working together to reduce losses.
` Important regional differences in results (eg,
manpower/t, cost index) exist across all facilities
` Significant improvements in cost index and manpower
productivity have occurred since the 1989 study, with
improvements increasing from primary processing to
finishing operations.
` The profile of the best performers varies between
facility types, eg, reliability and availability are high in
blast furnace areas whereas availability in section and
rail mills appear to be less important. MS
Kees Tol is Best Practice Manager at Corus Engineering
Group, based at IJmuiden, The Netherlands and
Chairman of this worldsteel (IISI) project.
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