Improve processes, focus on value

Improving processes has become a fundamental part of running a business for maintenance managers. Multiple mini-process tools have been developed to help managers uncover poor processes performed in plants. These include Follow the Baby (observing a work order from birth to maturity) and DILO ("Day in the Life Of") studies. The real question is what should be done with the information once it has been gathered? You will find that the answers are unique to each industry; however, the methods for utilizing this information are universal.

This article outlines key considerations used to aid maintenance organizations in improving their processes, regardless of whether the plant is producing medicine, auto parts or electricity.

All of the miniature process tools listed in Figure 1 offer the maintenance department a measurable way to assess the effectiveness of the activities being performed by craft workers. Each tool illustrates specific improvement opportunities. Using these tools also provides the baseline to measure improvements as they are executed.

These tools, which help identify specific work details, have a common thread: the need to understand value vs. non-value for the activities uncovered (Figure 2). It is recommended that you conduct a mini-process on one of your technicians if you haven't done so already to discover more details on how their time is actually spent. Evaluating and acting on the data collected is the next step toward success.

Regardless of the task being observed (receiving at stores, corrective work orders, planning work or rebuilding a motor), the detailed observations require an understanding of what is value-added and what is non-value-added. Once the data has been collected and coded for the type of value it represents, the steps taken to reduce or eliminate the non-value activities are not always clearly defined. This is where many organizations run into difficulties. For example, we may know a technician has three non-value-added steps in his daily routine, but how do we eliminate them?

Here are a few considerations to keep in mind when choosing priorities:

First, not all waste can be eliminated. There is a subset of non-value work that is required to stay in place, called "non-value essential." Walking is an example of a non-value essential activity; it is still required that we walk to the equipment in order to fix it. For this and all other non-value essential activities, it's important to reduce the duration as much as possible. For items that are purely non-value and non-essential, like showing up at the equipment with the wrong wrench, it's important to strive to eliminate this waste altogether. The word "waste" is used in the context of the Toyota Production System, which divides waste into seven categories (see Figure 3). All of these wastes occur every day in our jobs. Taking action to reduce and eliminate them is up to the leadership group.

Figure 3. A traditional and maintenance-related look at Toyota's seven deadly wastes.

Second, although you may find an improvement opportunity that appears to be able to provide a 42 percent savings over current cost when measured, it's unlikely that all of this opportunity will come to the bottom line. A range of success occurs with every change that is put into place. In maintenance/engineering, processes are interdependent with many other departments. Improving these opportunities will likely require cooperation from multiple departments. Experienced change management/cost-reduction specialists typically predict that 50 to 60 percent of an opportunity identified will likely be corrected in the near term. In the case of a 42 percent opportunity, communicating a goal of 21 percent improvement is recommended. If the goal is exceeded, raise the expectation and continue to make improvements.

Third, when deciding how to prioritize elimination of operational waste, think of it in terms of what the idea is worth. If you are eliminating waste from a process that only occurs once every four years, reconsider the overall value of the process before spending valuable time redesigning the processes. Along with quantifying the opportunity, make sure that you evaluate the frequency and time spent on the task.

Figure 4. These charts represent the work of three technicians over a one-week period.

The charts in Figure 4 represent the work of three technicians over a one-week period by frequency and time spent. The first chart illustrates that executing work and documenting work are the dominant tasks. These tasks are the activities that bring value to the maintenance organization. When the technicians are executing work orders and documenting what they have done, life is good, right? However, look at the second chart that displays tasks by time spent. By looking at this chart, there is a whole new picture to evaluate. What is going on with all the waiting and inventory time? All of the non-value work is eroding this technician’s time
from getting the value-added activities completed. Whose fault is it? 
 
It is the established business processes that typically prevent the technician from effectively completing his work. Sometimes, the processes are established by default and are completely unintentional. Regardless of fault, it’s up to management to review the process steps and eliminate (or, at a minimum, reduce) the non-value steps to provide the employees a smart work environment.

Another consideration is the difficulty in rating the proposed change. The proposed change may be as simple as telling the technicians to start using the back gate and can be as tricky as recommending a new computer system for an organization to adopt. The level of effort will vary significantly with the proposed change. The change’s level of difficulty should not stop anyone from making the best recommendations for the overall organization. The point is to be smart about the task at hand and to organize your facts before you execute.

Some organizations go a step further with their analysis and combine return on investment (ROI) with difficulty in order to come up with a composite rating that looks at benefit vs. effort. The effort can be measured in dollars, labor hours or even a bid from a contractor. The benefit can be measured in dollars, cost avoidance or improved service. Developing a fair estimate for the ROI, as well as the effort cost, is a good business practice before making a change.

Using these simple guidelines will help get organizations over the difficult step of determining what processes to improve. Understanding the difference between value-added and non-value-added is a great lesson for everyone in the organization to know and appreciate. Employees at all levels can begin identifying opportunities for improvement when they have been educated on the concept of value vs. non-value. 

Everyone involved must recognize that removing all waste is impossible, accepting partial improvements is expected, and determining the value and priority of the actions are important. These are all instrumental in determining which maintenance processes should be improved and in what sequence they should be addressed.
Joe Mikes Sr. is a consultant for Life Cycle Engineering. For more information, call 843-744-7110 or visit www.lce.com.