Successful companies treat Support services as a priority for overall performance, business value and competitive advantage.
Support
must extend beyond providing reactive services whenever there is a problem.
Leading companies strive for a collaborative relationship with their vendor;
that they’re looking out for them and working proactively to help meet
performance goals – today and in the future. Support programs should include
proactive service elements such as upgrade planning, access to value-added
information, and guidance on improving asset performance.
Many
operations are finding that by taking a holistic perspective on Support,
Services and Maintenance, they can achieve synergy and drive value to the
bottom line.
This
approach is effective for organizations that are growing as well as those that
are focused more on production efficiency and reliability.
Support
+ Services + Maintenance = (Greater) ROI
By
integrating a broader perspective on Support with Performance Improvement
Services and proactive Maintenance, companies can drive greater Operational
performance, and greater business value.
Successful
organizations are finding that they can get enormous value by leveraging the
skills and experience of their automation vendors. In fact, they almost have to
in order to really get the most out of their assets. Automation system vendors
have resources simply not available to customers. It’s their job. Beyond just
knowing how to implement and configure their products, vendors understand what
those products were designed to deliver, and how to tune them in a production
environment to get the most out of them. Whether it’s performing Advanced
Process Control, tuning Control loops, rationalizing Alarms, or delivering MES
integration, forward-thinking vendors offer services that can drive improved
performance.
More
strategic services should be considered to learn and apply industry best
practices, modernize plant operations, integrate Operations systems with
Business systems, or develop more effective Knowledge Management practices.
Looking at the big picture, from a broader and deeper perspective can produce
some valuable results to improve performance, even in the short term.
Maintenance
– Impeding or Improving?
Maintenance
must be considered as part of the picture, too. Maintenance is often considered
as a necessary evil or seen as an impediment to production. But when it is
viewed as part of the equation, companies can proactively integrate maintenance
as a key element for improved operational performance.
Many
operations keep a supply of spare parts for critical equipment, but what effort
is made to ensure that those parts are kept at current revision levels,
upgraded to new technology, or even maintained themselves? Some vendors offer
programs to manage spare parts for their clients, even to storing them in
controlled areas with guaranteed response times.
Most
maintenance departments are facing the challenge of impending retirements and
these teams often struggle to keep up with all the new technologies. As
software becomes more integrated into operational systems, the task of
maintenance becomes even harder – for new staff as well as the “old hands”.
Businesses can leverage their vendors’ resources to take advantage of their
knowledge and experience not only with their products, but also with complex
applications.
Support
Programs – A Cost or a Benefit?
Many
operations struggle to justify ongoing support costs. If you only look at
support like insurance, the question is really one of risk and impact. If you
never take advantage of support services, then it seems like a bad investment.
But, if you have a major problem solved through support, there is clear value.
The
preventive aspects of support are a “hidden” value often overlooked. Not unlike
performing preventive maintenance on equipment, it’s very difficult to estimate
the value of installing available software updates, training operators on
updated procedures, or upgrading to current equipment. But these activities are
all geared to prevent future problems and sustain performance.
What
does one hour of downtime cost your operation? What is the productivity of your
personnel worth? What would it cost if you had to buy all the upgrades included
in your support program? These are some of the factors to consider when
justifying the value of support. In most cases, if you add it all up over time,
the cost of NOT having a formal support program far outweighs the cost.
And,
when you consider the additional value available by integrating other elements
of proactive service and maintenance, there are even greater benefits. By
including services aimed at improving operational performance, tapping into a
knowledge base of deep experience and skills, and other proactive support,
problems can be avoided and additional benefits can be achieved.
Without
a Support Agreement, support costs can vary widely. It may cost less at first
but, sustaining the same performance levels costs more over time if you don’t
have formal support.
Simply
put, a business case justifies an expense by comparing the benefits that will
be realized from an investment in capital or operating cost. While the costs of
an investment are usually easy to measure – the price tag - the benefits are
much harder to quantify. In the context of a “Sustain and Improve” support
model, benefits can be categorized as:
- Reduction in the loss of production capacity – Support elements that ensure asset availability, reducing downtime
- Maintaining systems for maximum longevity – Services that keep your systems current and performing as intended, avoiding capital expenditures
- Improvements in production performance – Services that will increase production capacity, productivity, yield, efficiency, quality
- Increasing Operations staff performance levels – Support elements that increase staff productivity, effectiveness, skills
- Cost savings through discounts, economies of scale, service “packaging” – Leveraging available pricing structures to reduce costs for equivalent or greater service levels
These
are not the only potential benefits from a comprehensive support program, but
they are the most measurable. Additional consideration could be made for
avoiding business and safety risks and fines from failure to meet regulatory,
environmental and safety standards. There could even be performance penalties
from not meeting contracted deliverables. Anything that delays production
impacts your customers, your reputation and even shareholder value.
Estimating
the value to be gained from a support investment requires some assumptions to
be made. For example, to measure the value of reducing downtime of production
assets:
- What does a unit of downtime cost in your operation?
- How often is that unit likely to occur in the target time period?
- How do specific support elements reduce the likelihood of that occurrence?
- What is the predicted impact of those support elements?
- What is the impact on other parts of the operation?
The
starting point to estimate the value of support is to define your operation’s
“Serviceable Events”. Serviceable Events are defined as opportunities to
directly impact operational performance – for good or bad. An example of a
Serviceable Event is the breakdown of a key pump. In our model of a
comprehensive Support program, factors that influence the performance of that
pump could include:
- A preventive maintenance program to reduce the risk of premature failure
- Condition monitoring to get early warning of impending problems to minimize the impact
- Fast access to spare parts to effect repairs
- Redesign of procedures to speed pump repair and reduce impact on production
- Performance tuning to ensure a reasonable load on the pump
- Access to resources with the skills and training to diagnose and repair the pump
As an illustration, let’s estimate the impact on production
resulting from a breakdown in that key pump as:
We’ve shown some of the ways that an effective support program
could impact that Serviceable Event, but what is the potential effect? By using
historical information, industry standards and best practices, we can make assumptions
that an effective support program could reduce the number of annual incidents
to 3 and shorten the downtime by an hour.
In this example, a comprehensive support program that integrates
elements of performance improvement services with maintenance and support
services could save $110,000 per year. While there are a number of assumptions
required, and only a single asset examined, it’s clear that significant
benefits are possible. Extrapolate this example across all the assets in your
operation and the potential value expands dramatically.
A Serviceable Event can have an impact beyond the immediate
incident. In many industries, the cost of a process re-start is significant,
with an impact on energy costs, environmental controls, product quality and
operator safety. The incident could have an impact on related aspects of the
manufacturing process, causing a ripple effect throughout the operation. The
incident could produce wastage, impact overall quality and impact inventory
levels. These “side-effects” are very real, but extremely difficult to
quantify.
Positive Serviceable Events
Serviceable Events are not only negative; they can be
opportunities to add value to production operations as well. Some examples of
support service elements with a positive impact through a Serviceable Event
include:
- Access to software upgrades that increase productivity
- Access to upgrades that improve asset performance
- Planning services to make the best decisions about future activities and upgrades
- Access to expertise and knowledge libraries to augment staff experience
- Training courses to improve overall effectiveness and productivity
- Consulting reviews to improve procedures for safety management
- Periodic audits of regulatory compliance, environmental and security management
While some of these positive events are difficult to quantify value
from, others can provide a measurable benefit.
Summary
It is possible to win the battle to sustain
operational performance. It takes a broader perspective and the willingness to
integrate options for support, maintenance and performance improvement. It is
also possible to measure and demonstrate the benefits that such a program can
provide your business. Companies can sustain and improve operational
performance through an integrated approach that focuses on four key areas:
- Protect Critical Investments - An effective, integrated support, maintenance and services program can sustain and extend the life of business-critical production software systems.
- Maximize Asset Performance - Downtime costs companies millions of dollars. Integrated support options will maximize productivity and performance by keeping operations running smoothly.
- Reduce Total Cost of Ownership - Saving money is always important. A broader, integrated support program can provide innovative discounts and flexible funding options to save over the long term.
- Improve Operational Performance - Performance improvement services that leverage vendors’ skills and experience can reveal new ways to improve performance to drive added operational value.
Companies that have taken this approach view Support not as a sunk
cost, but rather as a valuable resource that provides real competitive
advantage.
Related
posts:
No comments:
Post a Comment