maintenance kpi short assignment
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8/10/2019 Maintenance KPI Short Assignment
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Maintenance Engineering & Asset Management
Module M03
MAINTENANCE STRATEGY
SHORT/IN UNIT ASSESSMENT
Name: Hernán Quiroz
Company: Ternium Siderar
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I. Key Performance Indicators
I. Key PerformanceIndicators..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................1
A. THE MAYOR CHALLENGES FOR MAINTENANCE IN STEEL I NDUSTRY .......................................................... 1
B. KPI´S USED IN TERNIUM SIDERAR STEEL FACTORY ................................................................................... 21. Effectiveness Measures .................................................................................................................. 2
2. Efficiency Measures ....................................................................................................................... 2
3. Safety Measures ............................................................................................................................. 2 4. Consideration................................................................................................................................. 2
C. CONCLUSIONS...........................................................................................................................................3D. APPENDIX 1: TERNIUM SIDERAR MAINTENANCE KPI´S............................................................................ 4
1. Direct Maintenance Cost ............................................................................................................... 4
2. Diary Plant Downtime ................................................................................................................... 4 3. Pareto Downtime (6 month) ........................................................................................................... 5
4. Efficacy-Nª Job Completed/Month ................................................................................................. 5
5. Workshop Backlog ......................................................................................................................... 6 6. Turnover of spare parts .................................................................................................................. 6
7. Frequency Index (FI), Gravity Index (GI)...................................................................................... 7
8. FI Benchmark................................................................................................................................. 7 E. APPENDIX 2 ..............................................................................................................................................8
1. Figure 4.4 – Efficiency & Effectiveness ......................................................................................... 8
2. Figure 1.5: Total Cost of Maintenance .......................................................................................... 8 F. R EFERENCES .............................................................................................................................................9
A. The Mayor Challenges for Maintenance in Steel Industry
Nowadays, the COST is the key driver for Maintenance in the Steel
Industry.
To begin with the recent history of the Steel Industry, before the 90th
decade, the Steel was considered as a nation strategic asset for military
matters. After 1990, the privatisation process took place along the world.
For the actual century more than 90% of Steel factories are controlled byprivate companies. This phenomenon produced an atomized steel market.
According to the Word Steel Association, the mayor producer has less than
10% of the market sharei. Because of the atomized market, the steel
Industry is a very competitive business in which there aren’t big players
that can control the price. In this context the most efficient companies will
buy the less efficient. It is a natural market process.
What is more, “The global steel industry has not escaped the current
economic downturn and this will be reflected in the figures you see for the
last quarter of 2008ii. The industry has responded rapidly with production
cuts, to ensure supply matches demand. 2009 will be a difficult year in
terms of profitability. There will be restructuring in the industry and this
will be hard on those involved iii.”
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Production Evolution for 2008 – Word Crude Steel Statistics (106 Tons)
Source: Word Steel Association
As maintenance is one department into the company, not a company of
maintenanceiv, the mayor challenge for maintenance in the steel industry
is to maintain functions of equipments for a required time with maximum
safety and minimal environmental impact for the life cycle cost at the less
cost as possible.
B. KPI´s used in Ternium Siderar Steel FactoryIn order to check that the challenges are being met by the maintenance
strategy, Ternium Siderar has the following KPI´s (See appendix 1):
1. Effectiveness Measures
- Direct Maintenance Cost - Cost vs Budget (long term control)
- Diary Plant Downtime (short term control)
- Six Month Pareto Downtime (long term control)
2. Efficiency Measures
- Nº Job Completed / Month or day (long / short term control)
- Workshop Backlog (short term control)
- Turnover of spare parts (long term control)
3. Safety Measures
- Frequency Index (FI), Gravity Index (GI) (long term control)
- Frequency Index Benchmark (long term control)
4. Consideration
In Ternium Siderar we have a diary planning meeting between
maintenance and production in which we analyse the diary plant
downtime. Apart from this, in the workshop, the maintenance
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department reviews the Nº Job completed/day and the backlog. The
rest of KPI´s are being monthly analysed between maintenance and
production department.
Each KPI´s has standard, targets and it is automatically obtain from
the systems. (SAP, QNX).
Everybody into Ternium Siderar could access to maintenance KPI´s
(Free Public Access).
In this assignment, It has been presented the most representative
Ternium Siderar Maintenance KPI´s. These are only the 25% of the
total SITE.
C. ConclusionsIn my opinion Ternium Siderar has developed a very good KPI´s in the
Maintenance Site in order to keep indicators on target.
If I compare the Ternium Siderar KPI´s with the Efficiency &
Effectiveness diagram (see Appendix 2.1), we have developed very
well KPI´s to measure Effectiveness and we have opportunity to
improve in Efficiency.
According with the Industrial Steel context, I consider that the next
step for Ternium Siderar is to begin to measure the Hidden Cost in
direct form, for example the Cost/Downtime. We have automatically
registered every downtime. In addition to this, we have the
opportunity cost per unit process and the cost for the scrap that every
downtime produced. We have everything in our systems, but we only
display the visible part of the iceberg (see Appendix 2.2). Ternium
Siderar must show the part of the iceberg behind of the water line in
order to maintain the leadership in the steel industry.
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D. Appendix 1: Ternium Siderar Maintenance KPI´s
1. Direct Maintenance Cost
2. Diary Plant Downtime
LabourMaterials
Contracts
Services
Others
Month Year
Dif. Dif.
MAINTENANCE DIRECT COST
BUDGET BUDGETReal Real
LabourMaterials
Contracts
Services
Others
Month Year
Dif. Dif.
MAINTENANCE DIRECT COST
BUDGET BUDGETReal Real
Cool Mill
D O W N T I M E ( H o u r s – F r e q u e n c y )
T o t a l M o n t h
Frequency Last Month DowntimeTotal Last Month
Frequency Month SAPTotal Month IGO
Frequency Month IGOFrequencyDowntime Last Month
Maintenance Downtime
Cool Mill
D O W N T I M E ( H o u r s – F r e q u e n c y )
T o t a l M o n t h
Frequency Last Month DowntimeTotal Last Month
Frequency Month SAPTotal Month IGO
Frequency Month IGOFrequencyDowntime Last Month
Maintenance Downtime
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3. Pareto Downtime (6 month)
4. Efficacy-Nª Job Completed/Month
PARETO DOWNTIME (6 Months)
H o u r s
SAP Equipment Number
PARETO DOWNTIME (6 Months)
H o u r s
SAP Equipment Number
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5. Workshop Backlog
6. Turnover of spare parts
Workshop Backlog
W o r k O r d e r s
Months
Workshop Backlog
W o r k O r d e r s
Months
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7. Frequency Index (FI), Gravity Index (GI)
8. FI Benchmark
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E. Appendix 2
1. Figure 4.4 – Efficiency & Effectivenessv
2. Figure 1.5: Total Cost of Maintenancevi
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F. References
i Top Steel Producers 2008, Word Steel Association, link:
http://www.worldsteel.org/?action=storypages&id=330
ii Crude Steel Statistics 2008, Word Steel Association link:
http://www.worldsteel.org/?action=stats&type=steel&period=latest&month=13&year=2
008
iii Ian Cristmas (2009), Director General’s column, Word Steel Newsletters 32, Word
Steel Association. Link: http://www.worldsteel.org/?action=storypages&id=332
iv Tom Lenahan (2009), Complexity of relationships between maintenance, operations,
and business function in a company, page 6, Residential Classes-MSc Maintenance
Engineering & Asset Management-Manchester University
v Paul Wheelhouse (2009), Section 4.1, Figure 4.4, M01 Maintenance Strategy, MSc
Maintenance Engineering & Asset Management-Manchester University
vi Paul Wheelhouse (2009), Section 1.1, Figure 1.5, M01 Maintenance Strategy, MSc
Maintenance Engineering & Asset Management-Manchester University