How is the relationship between operations and maintenance at your plant?

Figure 2. Alcoa Warrick Smelter’s R&M costs are 29% below its 2003 pre-REX base and OEE performance improvement gains are worth another $9.5 million annually.

In 2003, Alcoa’s aluminum smelter east of Evansville, Indiana, was 43 years old and had the second highest maintenance (R&M) costs in the Alcoa Smelting System. Asset reliability in the plant continued to suffer, and equipment instability was holding lean manufacturing gains hostage. A formal assessment of the smelter’s R&M efforts determined a mostly reactive approach with a focus on trying to be really good at emergency breakdown response.

With strong sponsorship in 2003, the location embarked on a reliability excellence (REX) transformation. Ten years later in 2013, Alcoa Warrick Smelter’s R&M costs are 29% below its 2003 pre-REX base — 44% lower adjusting for inflation —and OEE performance improvement gains are worth another $9.5 million annually (Figure 1). A formal asset integrity audit performed by corporate-level resources in late 2010 determined that the Alcoa Warrick Smelter had the lowest percent of corrective actions needing attention in the next five years versus all other Alcoa smelters worldwide (Figure 2). This audit confirmed that cost savings gains were not from R&M deferral.

Figure 1. Operations-production played a key role in the success of reliability excellence at Alcoa Warrick Smelter, dropping normalized maintenance costs significantly over the past 10 years.

Sponsorship and partnership

The REX Model used by the consultant we employed in 2003 to help us to implement REX emphasized the tremendous importance of REX sponsorship and plant REX partnerships. These two concepts are the cornerstones in the foundation of successful REX implementation. Without executive sponsorship and partnerships, implementation of reliability excellence will be a struggle, and initial excitement and optimism in the plant population will eventually move toward indifference. And REX will become another “flavor of the month” rather than the game changing transformation it is capable of being.

When the Alcoa Warrick’s REX journey began in 2003, Royce Haws, location manager and one of the authors of this story, was the sponsor. Interestingly, Haws had attended a one-week reliability excellence overview session, and while there he was sold on the potential value of REX to lower R&M costs and improve plant OEE performance. Ten years later, he continues to be a strong supporter of REX. When there is an opportunity to speak before a plant audience or corporate-level group, he always shows strong leadership and sponsorship for REX and highlights recent cost savings we have experienced.

How is the relationship between operations and maintenance at your location? Does it feel like a partnership? What is the probability that operations and maintenance will naturally become partners in the success of reliability excellence? It’s a low probability, especially in a highly reactive R&M environment. This is why executive sponsorship is so important.

In 2003, the Warrick Smelter’s REX Lead Team articulated a target condition or future guiding principles for REX. Some important REX ideals included working 90% of R&M labor resources on planned-kitted-scheduled jobs, maintenance providing emergency R&M response only on true emergencies, periodic maintenance backlog prioritization, and work documentation for all R&M work via work requests for potential failure analysis for trends and/or abnormalities

In most cases one can say that maintenance has a responsibility in many of the REX ideals. However, for each REX ideal, does maintenance have 100% control over a successful REX outcome? The answer is most often, “ no.”

Maintenance does have responsibility and almost 100% control over the successful REX outcome of efficient, quality craft-work completion once it’s in possession of the equipment for planned-scheduled R&M work. Maintenance also has responsibility and almost 100% control over a successful REX outcome for capturing all R&M work it performs on a work ticket. Beyond these two REX ideals, it’s going to be very difficult to argue that maintenance alone has 100% control of a successful REX outcome. In the absence of an operations and maintenance REX partnership, most of the REX target condition ideals or future guiding principles will not be achieved.

Ron Moore, CMRP, managing partner of The RM Group  in Knoxville, Tennessee,  highlighted Warrick’s lack of REX partnerships very well in 2003. He asked Haws, “How are your assets operating today?” Haws turned to his maintenance manager and asked him the question. Moore used this non-REX example as an excellent teaching moment. He told us all that we had way too much maintenance involvement in our maintenance program.

Moore, who also has authored, “Making Common Sense Common Practice: Models for Manufacturing Excellence” and “What Tool? When? A Management Guide for Selecting the Right Improvement Tools,” made us realize that the maintenance manager doesn’t own the equipment anymore than the mechanic at the garage owns the reliability of your car. The garage mechanic can certainly help the owner have a well-maintained, reliable automobile if there is a good partnership between him and the owner. The owner operates and sees the car daily so he is in a much better position to know how the car is running. The mechanic sees the car only when the owner decides to bring his car to the garage. A garage mechanic might make some recommendations on parts showing preliminary wear and recommend proactive repairs. Many car owners don’t act on feedback from their garage mechanics on suggested repairs because they don’t trust them. Certainly this would be the opposite scenario of a strong REX partnership.

So let’s ask the question again. How is the relationship between operations and maintenance at your location? Does it feel like a partnership? Or is there so much emotional baggage that the relationship is mostly adversarial? In a highly reactive R&M environment, it’s easy for this relationship to be more the relationship portrayed in those old cartoons between the roadrunner and coyote or Foghorn Leghorn and the dog.

REX is about moving away from a highly reactive R&M environment where an adversarial operations-and-maintenance relationship comes easily day after day. And the first steps are executive sponsorship followed by an REX partnership, which requires taking a leap of faith that operations and maintenance can work together and achieve reliability excellence.

The look of an REX partnership

We had success with formal operations-and-maintenance REX partnership agreements. These agreements detailed how we were going to treat each other. Detailed below are examples from some of our partnership agreements:

Production to Area Maintenance

• operators own their equipment
• equipment operated within capabilities 
• equipment is under autonomous maintenance philosophy 
• equipment problems are identified early and work request generated 
• equipment is made available for PM/PdM 
• equipment down, tagged, clean, and ready for maintenance.

Area Maintenance to Production

• equipment outage coordinated within production schedules
• provide high quality workmanship — timely and efficient, 5S
• equipment operates at designed capacity, first time every time 
• PM/PdM on time and generate corrective work (6:1) 
• good history captured — continuous improvement.

Operating Areas to Planning

• understand definition of emergencies, manage acceptable risk, and be consistent with respect to emergencies
• forethought in requested work — if there are prerequisites to begin a maintenance job, do not discover these during the week of execution; some forethought is required
• clear and descriptive work requests
• prepared jobs sites —tagged and clean, not just surroundings but flanges, bolts, and bases, for example
• ask for maintenance before the equipment breaks
• clear job priorities
• feedback to maintenance and planning — particularly when repairs are less than ideal or acceptable.

For us, these partnerships represented a definite new way of thinking and behaving. Although we had no R&M partnerships in place between operations and maintenance before REX, the behavior in place suggested some issues:

• Weekly R&M schedules are wish lists, and many of the jobs on the schedule are not planned
• “Make hay while the sun shines,” and I’ll give you the equipment when I decide I’m ready
• How much longer can we operate this equipment before that little noise becomes a bigger problem? That’s what I’m going to do because it’s not broken yet.
• We’ll shift blame for poor equipment condition to maintenance as outages and PMs are postponed.

True partnerships

A true operations-and-maintenance REX partnership cannot be mandated because it is a huge culture change. And for that reason change management is needed. Change management is just as important as executive sponsorship and project management.

Our change management started with REX education. REX education aimed at giving folks profound knowledge or a new way of thinking. The hope is that this education results in curiosity, a positive change of attitude, and a short-term commitment to give REX thinking a try. Each successful REX outcome provides a single new REX experience, and that is how a plant culture is slowly changed. Our REX education process included:

• P-F curve understanding
• 150 people playing REX-oriented games, such as “The Reliability Game” and “Who Wants to Be a REX Millionaire?”
• certified maintenance & reliability professional (CMRP) certification – 23 each now
• “home maintenance approach” discussions and how REX relates at home, too.

Our REX communications process included:

• handwritten letters sent home when a craft person exhibited REX thinking
• “employee touch plan” 1:1 discussions each month with each craft employee
• highlighting REX successes with single point lessons
• de-emphasizing heroic R&M firefighting.

Again, educating the entire workforce on the business-case need to change is a key change-management concept. Haws has always expressed the need for us to be cost-competitive. Only 20% of the aluminum smelters operating in the United States in the early 1970s are still in operation today. There were 41 operating and now there are only eight. Warrick needed REX to work, or they risked becoming a statistic. Many well-paying American jobs would be lost, as would the $1.5 million that the facility brings to the regional, state and national economy.

Another huge positive outcome of the REX implementation that benefits all of Warrick’s craft personnel is that planned, kitted, and scheduled work is safer than unplanned, unscheduled emergency work. Emergency work has “error traps” such as time pressure, distractions, vague work guidance, poor communications, and stress. All of these conditions can contribute to a craft employee injury. The smelter’s maintenance total injury rate was 8.7% in 2001-2002. More recently we have experienced 0.9% in 2010-2013. It is clear that REX has been a major contributor to a safer work place for our craft people. If the maintenance total injury rate in 2001-2002 had continued through 2013, 75 more craft people would have been injured. This is a huge achievement and who knows how serious some of those 75 injuries might have been.

Takeaways

Warrick’s Reliability Excellence journey has built off of the operations-and-maintenance partnership and benefitted from other key takeaways. If a majority of reliability-and-maintenance work requests occur in an unplanned and unscheduled manner, aimed only at equipment that has been run to failure, the 7x and 10x cost-savings factors are lost. It would require a huge R&M workforce to maintain a plant effectively. Instead the plant OEE performance will “grind down” to some maintainable level with existing R&M workforce. A lot of profit is lost.

Warrick’s pre-2003 PdM approach was insignificant and more like a home hobby with only 1.5% of total hours dedicated and weak follow-up on PdM-generated corrective work. Today,  the smelter has 14% PdM diagnostics with 26% follow-up PdM, PM and operator-care corrective work.
Avoid the temptation of using PdM and PM processes but then optimizing a run-to-failure philosophy. How many more hours do you think we can get out of this machine until it fails?

Not performing unplanned PM corrective work during the PM is important, but not reducing PM hours accordingly creates a hidden maintenance workforce and corrupts all of the REX metrics. For example, if today’s four- and eight-hour PMs are all completed by 9 AM, with 100% PM compliance achieved, 100% schedule compliance achieved, and 100% planned work achieved, what should be done with the craft folks for the rest of the shift? Divert to emergencies, assign to work not on schedule, percentage of emergency work now is understated, or at worst, no additional work is assigned.

Today, 50% of Warrick’s spare parts for planned, kitted, and staged jobs come brand-new from suppliers with a focus on four to six weeks of ready planning-scheduling backlog. In reality, storerooms are big countermeasures for emergency maintenance. This fact was highlighted when all salary personnel played “The Reliability Game” for eight hours.

REX success

We are convinced at the Alcoa Warrick Smelter that REX has produced huge cost savings. Alcoa hosts an annual worldwide competition known as Impact to highlight outstanding initiatives. The awards attracted 243 entries in 2013, and 18 finalists were selected to come to Pittsburgh to the Alcoa Leadership Conference in March to present to a worldwide group of Alcoa’s top managers. It was a grand opportunity for these 18 teams to demonstrate how great ideas, when combined with hard work and disciplined execution, can lead to great success. Warrick Smelter REX was one of the 18 finalists this year.