Value-driven solutions

In today's economic climate a maintenance manager must be proactive in focussing on activities that will directly impact the bottom line. Here, Mick Saltzer, managing consultant for Mainnovation, discusses how to develop an effective maintenance strategy based on Value Creation

When asking a maintenance manager what is their most important strategic objective, typical responses may include: To serve production the best way we can (without production there would be no need for doing maintenance anyway) To stay within budget at all times To become (or remain) a world class/best in class maintenance organisation To make money for my company The common theme here is the desire to sustain or improve performance. However, to achieve this objective will require challenging current ways of working to optimise existing or introduce new practices.

The maintenance manager must learn to anticipate the changing needs of the business and align himself with the strategic aims of the board, developing smart objectives and talking the same financial language.

Understanding how value can be created with an effective strategy is the key to success. Value Driven Maintenance (VDM) defines four value drivers: Asset Utilisation: Increasing the availability of assets will increase revenue (in the right market conditions).

Cost Control: Sustainable cost controlling measures (critical in a declining market) SHE: Compliance with safety, health & environmental legislation is essential if not to compromise a business and risk losing a license to operate.

Resource Allocation: Holding spare parts is expensive and requirements must be clearly assessed.

To establish which value driver is dominant requires collection of reliable and industry-specific benchmark data and comparison with current levels of performance. The value potential = realistic achievable level of professionalism x incremental value.

Calculation of the value potential of each of these drivers will provide a quantifiable target that can be achieved in each. In most cases one value driver will be significantly higher than the others and focus on this dominant driver will speed up business results. It should be noted that the value driver changes over time, influenced by both internal and external factors. The successful manager will anticipate these changes and adopt his strategy as the business dictates.

Conducting a benchmarking audit can provide a compelling case for change and identify attention and improvement priorities, utilising both quantitative and qualitative assessments of performance. It will also facilitate the setting of realistic but stretching targets and help define the future organisational requirements.

An effective strategy will consider current CMMS functionality and capability and the effectiveness of existing maintenance plans in achieving desired levels of performance. It should consider the scope of necessary processes and the roles and responsibilities of those involved.

VDM defines 10 competences and a strategy based on value creation must select the core competences that drive improvements in support of the dominant value driver.

Too often organisations attempt too many improvement activities with long lead times; the key to success is to focus on a few and adopt external best practices to accelerate improvement.

To sustain the improvements requires formalising and standardising work processes. Clearly defining, roles and responsibilities will provide management confidence that the selected best practices and CMMS are being applied in an effective manner. This will of course require training, assessment and engagement of staff to ensure the processes and practices are truly adopted and embedded in the organisation.

Use of an effective KPI reporting tool combined with an appropriate meeting framework will drive improvement and support effective decision making.

Conclusions Key steps to a Value Driven Maintenance Strategy are: Understand your Dominant Value Driver.

Understand how good you are and where you need to improve.

Use proven best practices maintenance processes to accelerate improvement.

Measure performance regularly and continue to improve.