10. Life Cycle Costs
Life Cycle Costing (LCC) is a technique to establish total cost of
ownership of a product.
Material
Extraction
Material
Processing
Manufactur
ing
Utilization
Waste Mgt.
LCC
11. Life Cycle Costs
Typical product spend profile
The cost of ownership of an asset or service is incurred throughout its
whole life and does not all occur at the point of acquisition.
Principles of LCC can be applied to both complex and simple
products/projects.
Acquisition
Operation
End of Life
12. Procurement
Implementation and acceptance
Initial training
Documentation
Facilities
Transition from supplier
Changes to business processes
Withdrawal from service
Life Cycle Costs
Retaining
Operating costs
Service charges
Supplier management costs
Downtime/Non-availability
Maintenance & repair
Transportation & Handling
Recurring cost
Costs
Involved
One-off Costs
Fixed Costs
13. Maintenance
The combination of all technical and administrative actions, including
supervision actions, intended to retain an item in, or restore it to, a state in
which it can perform a required function.
Definition
Maintenance is a set of organised activities that are carried out in order to
keep an item in its best operational condition with minimum cost acquired.
Activities
Repair
Replacement
Important for an item to
reach its acceptable
productivity conditions
Should be carried out
with lowest possible cost
14. History of Industrial Revolution
1750-1830: Industrial Revolution was confined to UK
Britain strictly prohibited the export of machinery, skilled workers &
Techniques beyond their island empire
Their monopoly couldn’t last forever, specially when some Britain's
envisioned highly profitable opportunities abroad
Continental European Businessmen sought to Lure British know
how to their countries & offered significant incentives
15. History of Industrial Revolution
Industrial Revolution in Europe:
◦ William Cockerill & John Cockerill brought industrial
revolution to continental Europe in Belgium by developing
machine shops
◦ Belgium became the 1st country in continental Europe to
be transformed economically by industrial Revolution
France was slow because of his engagement with
the internal Revolution
In 1848: France became industrial power
The
Game
Moves Onward…
&
16. History of Maintenance
Manufacturing machinery of that time was subject to rapidly
increasing failure rates with age
When failures occurred, Production would be halted for repairs and
some other manufacturer would steal away the merchants who
have previously bought from the “down for repairs”
Although repairs were made as quickly as possible to resume
production, the lost buyers could not be regained
This resulted in manufacturer’s deliberately overproducing &
stockpiling manufactured goods
When they had sufficient backlog of goods, these manufacturers
would shutdown their power plant and repair production machinery
17. Maintenance Result
In 1903: Ford started its work
Build several different automobile models
In 1908: Ford Model T was introduced
1908: 100 Automobile / Day
728 Minutes / Automobile
1913: 1000 Automobile / Day
93 Minutes / Automobile
1908-1913
Serious Fine Tuning in Assembly
18. Why We Do Maintenance?
Is the purpose to fix machines that are broken or damaged?
Does this describe the real purpose of maintenance?
Can we view maintenance as being a way of preventing machines from failing?
Do we do maintenance simply to comply with regulations or for insurance reasons?
Do we overhaul machines because they are “due for overhaul” whether they need it or not?
Do we need to meet production goals and thus increase profitability?
When you are replacing the bearings in a motor, are you thinking of plant profitability?
Understand the Goals
First!
19. Do maintenance efficiently
Do maintenance to produce the product efficiently
Two Maintenance Perspectives
These are not mutually exclusive goals How we view the goal ?
Need to Understand
Organization’s Philosophy
21. Understanding Organization’s
Philosophy
Batch
• To keep equipment running during that process is paramount.
• A failure can cause huge production costs.
Fishing
• Fishing fleets may have a very short season.
• Any problem in their factory ships can result in lost of million dollars.
Power
• Loss of generation can not only affect revenue, but incur penalties.
• Subsidiary services are also affected.
US
Navy
• Their concern is “ship readiness“.
• Their ability to get under way when duty calls.
Since it is important to detect a problem before a failure occurs,
we must understand why machines fail in the first place.
22. Designers drafting board
Poor maintenance practices and operating conditions
Why Do Machines Fail?
Machine Failure
Start
End
The
way
machine
is:
Manufactured
Installed
Overhauled
Failure
starts
with:
Specifications
Purchase
Procurement
&
Although not all BUT Some of these
factors can be controlled
23. Maintenance Objectives
Maintenance objectives should be consistent with the production goals
The relation between maintenance objectives and production goals is reflected in
the action of keeping production machines and facilities in the best possible condition
Maximising production at the lowest cost and at the highest quality and safety
standards
Reducing breakdowns and emergency shutdowns
Optimising resources utilisation Improving spares stock control
Minimizing Energy Usage Optimizing useful life of equipment
24. Maintenance Objectives
M
a
i
n
t
e
n
a
n
c
e
Maximising Production
Minimising Energy
Usage
Optimising Useful Life of
Equipment
Providing Budgetary
Control
Optimising Resources
Utilisation
Reduce Breakdowns
Reduce Downtimes
Improving Equipment
Efficiency
Improving Inventory
Control
Implementing Cost
Reduction
25. Importance of Maintenance
Depending on industry, maintenance costs can represent between 15
and 60% of production.
Estimated that one-third of all maintenance costs is wasted due to
unnecessary or improperly carried out maintenance. (~$60bn out of
$200bn).
Difficult to compete with countries like Japan who have more
advanced maintenance strategies.
26. Importance of Maintenance
Maintenance spend is significant cost driver in today’s aircraft industry
70m hours per annum, equivalent to £7bn/annum,
is invested in civil aircraft maintenance
6000 man-hours per aircraft costing about
US$5.5 billion/year for the US air force and navy
In 1993, inspection effort on T-38 cost US$29 per
flight hour and for the F-18 US$88 per flight hour
Maintenance becomes even more important with machine ageing problem!
27. Importance of Maintenance
Aircraft Cost Breakdown
Fuel
Flight Crew
Depriciation
Insurance
Maintenance
Source: Introduction to Aircraft Design (chapter on
Why do aircraft cost so much?), J.P.Fielding
28. Importance of Maintenance
Civil Aircrafts Delay Causes
Passengers
Government
Authorities
Technical
(Maintenance)
Ramp Handling
Passengers
Source: Introduction to Aircraft Design (chapter on
Why do aircraft cost so much?), J.P.Fielding
29. Importance of Maintenance
Technical Delay Causes
Engine (Turbine)
Maintenance
Avionics &
Electric
Passenger
Accomodation
Landing Gear
Flying Control
MISC
Hydraulics
Structure
Source: Introduction to Aircraft Design (chapter on
Why do aircraft cost so much?), J.P.Fielding
30. Maintenance Plan
On Failure
Fix it when it fails
Fixed Time
Maintain Based
upon
Calendar
Condition Based
Maintain Based Upon
known Condition
Design Out
Identify & design
Out root cause of
failure
33. Reactive Maintenance
If it isn't broke, don’t fix it
No money spent on maintenance until machine or structure stops working
Sounds Interesting .....
BUT
AT THE COST OF HUGE MAINTENANCE BUDGET!
34. Breakdown Maintenance as Reactive
Maintenance ??
Control is lost when breakdown maintenance is employed. This
is why it is often termed“ reactive” maintenance.
The plant reacts or responds to equipment failures rather than
anticipating them, planning for them or avoiding them altogether.
35. Reactive Maintenance
Reactive Maintenance is:
Unplanned
Disruptive
Interruption
Costly ineffective response option
Allowing this to prevail as an existing response increases the overall cost
and complexity of managing the system.
Highly Undesirable
36. Reactive Maintenance
Objectives
Maximisation of the
effectiveness of all critical plant
systems
Elimination of Breakdowns
Elimination of Unnecessary
Repairs
Reducing deviations from
optimum operating conditions
Steps involved
Fault Detection
Fault Isolation
Fault Elimination
Verification of Fault
Elimination
Several actions should
be taken, like adjusting,
aligning, calibration,
removing, or replacing
39. A Plant in Reactive Mode
When a plant is primarily using run to failure
maintenance we can say they are caught in a
reactive mode
They are always reacting to problems and
situations.
When visiting a plant in this mode one will find
it to be dirty and disorganized.
Employees will complain that they are over
worked or always “too busy” to change how
they do things.
There will likely be a high rate of injuries,
spills, fires and other damage caused by
unexpected failures.
40. A Plant in Reactive Mode
Due to reactive mode, Plant is always behind
and trying to catch up to meet production
demands.
They are not running the plant, the plant is
running them and this is a frustrating
environment to work in.
Most of us prefer to work in a predictable
environment in which we feel we are in control
of the situation.
A plant in reactive mode is clearly not that type
of environment.
Morale will likely be low.
43. Reactive Maintenance
Requires no pre-care of the plant
Little management apart from organizing labor and stores
If applied correctly, it can be very cost effective
Advantages of Reactive Maintenance
are Outraged by its Disadvantages
ADVANTAG
ES:
44. Reactive Maintenance
Most expensive maintenance
method
No Failure warning:
Safety threat
Environmental Risk
High spare parts inventory
High overtime costs
Long machine downtime
Spare machines required
Low production availability
Large standby maintenance team
Knock-on effects on other
machines and overall loss of
production
Secondary/Consequential
damage may occur
DISADVANT
AGES:
Bearing
Shaft
Pump
45. Preventive Maintenance
Time Driven Maintenance
Time between maintenance decided on statistical data
Hour of Operations
Based On
Elapsed Time
Bath Tub Curve
46. Preventive Maintenance
Preventative maintenance is defined as regularly scheduled repair of
components and equipment.
It may consist of:
Scheduled inspection
Cleaning, lubrication
Parts replacement
Repair of components
Preventative maintenance is time based intervention according to a
prescribed schedule.
48. The unfortunate reality is that there is a high probability of failure
immediately after an overhaul due to:
Infant Mortality
Infant Mortality
Poor
lubrication
Incorrect parts
being installed
Poor
alignment and
balance
49. Estimated Life Vs Probable Life
The probability of failure increases before it "should" fail, so the length of the flat
section needs to change.
The reality of a failure rate is that it is random. Failure of a component occurs after a
time that cannot be predicted.
The task is to schedule the maintenance within the "probable life" period.
Unfortunately, we do not know what that period is, or how quickly the machine may fail
once the wear-out phase begins.
50. Risk is Balanced Against Cost
If the maintenance is put off too long, the machine may fail
If the overhaul is performed too early, it becomes too expensive, in
labor, lost production and parts
51. Preventive Maintenance
The machines are as likely to fail after two months as they were
in 22 months.
The concept of Calendar-Based Maintenance
contains flaws
52. A Plant in Preventive Mode
Machines will still fail due to the fact that 89% of failure modes are
random
Because machines are still failing, the plant is still in reactive mode,
however, they also have a huge amount of preventive maintenance
work scheduled that they have to do.
There will be stress, overtime and probably some resentment
towards planned maintenance tasks
These planned maintenance tasks are also costly in terms of manpower,
spare parts and downtime – even if it is planned downtime.
53. Preventive Maintenance Types
Preventive
Maintenance
Routine
Maintenance
Running
Maintenance
Opportunity
Maintenance
Window
Maintenance
Shutdown
Preventive
Maintenance
•Maintenance activities that
are repetitive and periodic in
nature
•Lubrication, cleaning, and
small adjustment
•Maintenance activities that
are carried out while the
machine or equipment is
running
•Activities that are performed
before the actual preventive
maintenance activities take
place.
Set of maintenance activities
that are performed on a
machine or a facility when an
unplanned opportunity exists
during the period of
performing planned
maintenance activities to
other machines or facilities.
Set of activities that are
carried out when a machine
or equipment is not required
for a definite period of time.
Maintenance
activities that are
carried out when
the production line
is in total stoppage
situation.
54. Preventive Maintenance
Factors affecting efficiency of PM
Need for adequate staff in order to perform maintenance
Right choice of production equipment & machinery that is suitable for the work environment
& capable of tolerating the workload
Required staff qualifications and skills, which can be gained through training
Support and commitment from executive management to the PM programme
Proper planning and scheduling of PM programme
Ability to proper apply the PM Programme
57. Preventive Maintenance
Reduces failures (compared to the on-failure strategy)
It uses the workforce cost-effectively with planned work schedules
Allows work to be planned well in advance
It can only be applied effectively on fixed time intervals where the
deterioration is age related
Scheduled maintenance costs are
around one-third of run-to-failure costs
ADVANTAG
ES:
58. Preventive Maintenance
The maintenance activity and associated costs will increase
Generally based on bathtub curve – not reliable in many cases.
The actual maintenance activity can sometimes cause failures itself
May be replacing a component that still has useful life
Treats all similar machines as same.
DISADVANT
AGES:
61. 80
82
84
86
88
90
92
94
25 30 35 40 55 60 65
%
Predictive maintenance improves production line performance
Predictive maintenance in % of total maintenance
Machine
availability
in %
62. This include most rotating machines with rolling element bearings. We
don’t know when the bearings will fail but they do let us know when
they are damaged or failing.
Plant in Predictive Mode
The plant is no longer in a reactive mode, so most
work is planned
Less overtime and workers are not stressed out
They come in to work every day and they know
what they need to do, there are few surprises
Neat and clean workplaces
63. Predictive Maintenance
Design of system
Monitoring equipment
Staff training
Labor costs for measurement and analysis
COSTS:
Elimination of unexpected & Secondary breakdowns
Increased time between services
Reduction of spare part stock
Reduction in insurance premium
SAVINGS:
64. Predictive Maintenance
ADVANTAG
ES:
Equipment can be shut-down before severe damage occurs
Alternatively, equipment can be run to failure if desired
Production can be modified to extend the unit life – For example:
Decrease the load on equipment so that it can
continue to run until the next planned plant
shutdown
The required maintenance work can be planned, with labor
organized, spares assembled, etc.
Reliability
Quality
Profitability
Productivity
65. Predictive Maintenance
Extremely Costly if
Implemented Incorrectly!
The drawback of predictive maintenance is that it depends heavily
on information and the correct interpretation of the information.
DISADVANT
AGES:
66. Proactive Maintenance
Elimination of conditional failures through the identification
of the root cause condition that initiates the failure cycle.
GETTING TO THE ROOT OF PROBLEM
It commissions corrective actions aimed at
the sources of failure.
Designed to extend the life of mechanical
machinery
67. Justification of Proactive Maintenance
• A predictive maintenance program gives a warning of bearing
failure, and then the replacement can be ordered and a repair
scheduled.
• That's great, but why did the bearing fail?
68. Plant in Proactive Mode
Similar behavior as in care of predictive maintenance
The condition of most of the plants assets is known
because CM technologies are being employed.
Machines should not fail unexpectedly - at least not
frequently.
One removes the root causes of many failures thus
increasing reliability and extending the life of the machines
69. Proactive Maintenance
One-off maintenance activity
It reduces failures
It will lead to increased production
It will remove or reduce the need for maintenance
ADVANTAG
ES:
70. Proactive Maintenance
Large design changes can be costly
Plant outages may be required to effect design changes
Unless root causes of failure are fully understood, changes may be
ineffectual, or potentially detrimental
There are sometimes unknown ‘knock-on’ effects of design changes
that can cause further difficulties later on
DISADVANT
AGES:
71. Condition-Based Maintenance
Condition-Based Maintenance
Proactive Maintenance Predictive Maintenance
Root Causes Failure Symptoms & Faults
Balancing/Alignment Tools
Viscosity/Contamination
Monitoring
Wear Debris Analysis
Vibration Analysis
Thermography/MCS
Fault Free Machine
Life Extension
Early detection of Faults &
Failures
Strategy
It Looks For!
Example
Technologies
Employed
Benefits
Sought
72. Maintenance
Strategy
Technique Needed Human Body
Parallel
Proactive
Maintenance
Monitoring and
correction of failing
root causes, e.g.,
contamination
Cholesterol and blood
pressure monitoring
with diet control
Predictive
Maintenance
Monitoring of
vibration, heat,
alignment, wear dibris
Detection of heart
disease using EKG or
ultrasonics
Preventive
Maintenance
Periodic component
replacement
By-pass or transplant
surgery
Breakdown
Maintenance
Large maintenance
budget
Heart attack or stroke
Maintenance Strategy – Human Body
Parallel
73. Key Facts
All four maintenance strategies are required to make an effective
Maintenance Plan.
All four maintenance strategies have advantages when implemented
correctly.
All four maintenance strategies have disadvantages when
implemented incorrectly.
The appropriate strategy can only be chosen when the reasons and
consequence for equipment failures are fully understood.
78. 0
10
20
30
40
50
60
Reactive Preventive Predictive Proactive
%
Source: Deloitte & Touche , CSI Survey
Maintenance Efforts Focus – In Future
All Industry in 5 years
Time Spent on Each
Maintenance Type
All Industry Now
79. 0
10
20
30
40
50
60
Reactive Preventive Predictive Proactive
%
All Industry in 5 years
Benchmark Now
Time Spent on Each
Maintenance Type
All Industry Now
Maintenance Efforts Focus –
Benchmark
Source: Deloitte & Touche , CSI Survey
81. RM
PM
RM = Reactive Maintenance
PM = Preventive Maintenance
In the past - “fix-it-when-it-breaks” concept
Highly reactive coupled with time-based preventive
maintenance and overhauls – whether machines needed it or not
Conventional Maintenance Culture
82. RM
PM
RM
PdM
PM
RM = Reactive Maintenance
PM = Preventive Maintenance
PdM = Predictive Maintenance
Today, more plants are reducing maintenance by adding predictive
technologies to help eliminate unscheduled downtime
Present Day Maintenance Culture
83. RM = Reactive Maintenance
PM = Preventive Maintenance
PdM = Predictive Maintenance
PaM = Proactive Maintenance
RM
PM
RM
PdM
PM
PaM
PM
PdM
RM
With a strategically balanced
approach, Maintenance Optimization
drives the achievement of mission
critical objectives - such as becoming
the Best Cost Producer
With Maintenance Optimization
84. Reliability Centred Maintenance
Four components of Reliability
Centred Maintenance Program
Reliability
Centred
Maintenance
Reactive
Maintenance
Preventive
Maintenance
Proactive
Maintenance
Predictive
Maintenance
Small items
Non-Critical
Inconsequential
Unlikely to Fail
Redundant
Subject to Wear-Out
Consumable
Replacement
Failure Pattern Known
Small items
Non-Critical
Inconsequential
Unlikely to Fail
Redundant
Subject to Wear-Out
Consumable
Replacement
Failure Pattern Known
85. Framework of Reliability Centred
Maintenance
Is Asset’s
Reliability
Acceptable?
Is Asset’s
Mission
Critical?
Is the Asset
expendable?
Continuous
Improvement
Run the Asset
to Failure
Will improved maintenance
cost effectively achieve
reliability objective?
Will redesign cost
effectively achieve
reliability objective?
Deploy
redundancy
Deploy
redesign
Deploy
advanced
maintenance
tactics
YES
YES YES
YES
NO
NO
NO
NO
NO
YES
86. Reliability Based Maintenance as a breakthrough strategy in Asset
Improvement
The function of maintenance is not to simply
maintain, but provide reliable production capacity
and to extend the life of plant assets at optimum
cost.
Reliability Centred Maintenance
Objective
87. 1. Elimination of plant downtime
2. Condition of equipment known. Machinery condition
information provides status of existing and future plant
capacity.
3. Commitment to extend the useful life of equipment
through the identification and elimination of failure modes
4. Development of work teams and team goals combining
maintenance and operations.
5. Maintenance & Operations are partners in providing and
utilising plant capacity.
10 Goals of Reliability Centred
Maintenance
88. 6. Maintenance is knowledge–based , providing for
improved decision making.
7. Commitment to create a learning organisation where
mistakes are not repeated.
8. Development of a systematic approach for each
situation ( predictive, proactive, preventive and
reactive).
9. Both management and operation staffs develop a plan
for action and improvement.
10. Maintenance function has long term objectives, where
the gains are sustained year after year.
10 Goals of Reliability Centred
Maintenance
91. 65 %
30 % 85 %
100 %
Ratio of planned to total maintenance
Maintenance
cost Index
Impact of Planning on Maintenance
Cost
92. Maintenance in the Organization
Traditional Maintenance
Reactive /PM
Maintenance Manager
TPM /TQM
Production Manager
Investments
Modifications
Engineering Manager
Plant manager
Predictive Maintenance
Proactive Maintenance
Root Cause Failure Analysis
Failure Defence Plan
Asset Manager
93. To select the optimum and most cost effective mix of
maintenance tools and methods to guarantee machine
reliability.
Failure Defence Plan
The goal of the failure defence plan is to assign techniques
which will warn or defend against equipment failure.
94. Worth
Kettle
Reactor pump
Heat
Exchanger
M
Functional Failure
Heavy seal leak,
Hot wart coming out pump.
Failure Effect
Reactor must be stopped.
Empty reactor.
Product/Time loss.
Failure Mode
Carbon seal ring of single
mechanical seal was broken..
Failure
Mode
&Effects
Analysis
Failure Cause
Due to an unbalance of the pump
seal ring has broken..
Failure Defence Task
1. Balancing/Vibration analysis every 3 months
2. Improve seal design.
Reactor Pump Failure Defence Plan