A Guide For Implementing Cost Reduction

How to apply basic process improvement principles to increase maintenance productivity and reduce costs

In their 1996 book, Lean Thinking, James P. Womack and Daniel T. Jones defined five basic principles that characterize Lean. These basic principles should be applied for each product or product family.

Principle 1 Specify value in terms of the end user.

The end user of the value provided by maintenance can be defined either as the entity that requires the equipment to operate, or as the end user of the product being made by the equipment. It doesn’t matter because the required behavior should be the same. The value typically can be defined as work performed in order to attain the required level of reliability of the organization’s equipment.

Naturally, not all work performed will provide the same level of value. Consequently, work must be prioritized based on the criticality of the equipment to the operation, as well as its impact on safety, the environment and production throughput.

In maintenance, this value is produced via the throughput (transaction) of applied labor hours. This is the “product.” Questions around this product can include:

  • Of the 40-hour work week, how many hours are converted into throughput and how many remain as untapped inventory in our system?
  • What is the market demand for these hours (backlog analysis)?
  • What is the productivity in making my product? (Average productivity in maintenance is 25 percent.)
  • What are the things eating remaining output?

Principle 2 Identify all steps in the value stream and eliminate those that do not add value.

First, create a Current State Value Stream Map (VSM), considering each maintenance work type. Identify all steps and determine which add value and which do not. Of those that do not add value, some will be easy to eliminate immediately, whereas others might require other changes and resources prior to elimination.

Next, create a Future State VSM, indicating the non-value-added steps removed. This is one of the major opportunities for waste elimination/minimization.

The VSM also provides other benefits:

  • Visualizes waste. Creates a sense of urgency to eliminate non-value-added activities as most waste is considered “part of our jobs” or “just how it is here.”
  • Helps standardize how work is done, yielding consistent results.
  • Helps show others outside of maintenance what goes on in the seemingly “black hole” of maintenance.
  • Shows others where maintenance requires their involvement in the maintenance and reliability process.

As shown in Figure 1, Waste (Muda) Identification, one of the most effective methods for performing a VSM for maintenance is to participate in standardized ride-along exercises. These physically trace a job from start to finish, documenting all steps and times captured for each, with the exception of actual work times. Estimates are fine, as the emphasis is on the Muda “around” the job, not questioning the craft skills within the job.

It is important to understand that this is not a time study, and the exercise must be preceded by educational materials that convey the point that the Muda is a reflection of the process, not the worker.

Principle 3 Make the remaining steps flow smoothly.

Once identified, Muda that is preventing optimum flow must be removed, but in an order that maximizes labor without consuming it, as it is easy to become overwhelmed by the opportunities uncovered by the VSM activities. At this stage, it is important that the productivity of the system be measured to document improvements to the system.

Measuring Flow. In production it is easy to measure the equipment generating output. In maintenance, however, this presents a unique challenge. The elusive “wrench time” has been the Holy Grail of maintenance – regularly discussed but never captured since resistance to self-incrimination is a human trait.

Whereas OEE (Overall Equipment Effectiveness) measures loss in equipment, OME (Overall Maintenance Effectiveness) measures loss within the maintenance process – not the worker – and can trend the impact of improvements (see Table 2, OEE vs OME).

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