Reversing a Downward Spiral

That is such a big what-if that we might as well talk about Big Foot.

What is the real question here? Is the poster looking for a single tonic to cure the ills of industry and do they believe that is a realistic goal?

The question is too broad and does not provide any specifics as to the real nature of the problem. What meaningful answer can you expect?

Management understands cost numbers or production volumes even when anything else is out of their area of understanding. Do everything you can to predict the costs in money or decreased production capacity associated with the "downward spiral" with several possible credible alternative scenarios. Better to have managers argue with your assumptions in an objective calculation than challenge a blanket request for more maintenance resources.

If this means a few sleepless nights so be it. Your organization is in crisis and you have a responsibility as a professional member of the management team to respond in appropriately.

Ed Weldon

Anonymous Hero, don't be so negative. Or maybe the negative is you being placed in charge??

Have seen this in a micro scale at the plant that I work at during a slow down. They decided to also cut the maintenance hours along with production. After about 4 weeks of that those of us in the maintenance departments had to work 60 hour weeks (all three shifts) to catch up with everything that we weren't able to take care of because of the cut hours. It only took us about a week and a half, but it did impact production.

I have seen the culture change from the maintenance crew being taken care of so they won't leave, to becoming the 'whipping boys' when things break down. About the same time that they decided not to put the capital into modernizing or just replacing what is broken. It has become a patch it, weld it, stick a band aid on it, but make it work so we can continue to make (whatever).

I am not saying that the maintenance crew needs to be coddled and babied, but an honest wage for an honest day's work. What is their worth to the plant and the company.

If the money is spent to upgrade or replace what is wearing out, along with the appropriate training to accomplish the preventative/predictive maintenance that goes along with it. Production and efficiency will increase, and right along with that profit for the shareholders.

Modernizing makes more sense, if your end result is still a viable 'product'. Especially if there are better more efficient ways to make your product. You would only need to repurpose your plant if your 'product' is no longer necessary. There may be a better way to make it, but if it is no longer needed it is time to make something else.

Good Luck and Have a Happy New Year!

I think you need to analyze the failures and determine the cause and whether or not you can practice preventive maintenance. The ideal practice is to find the breaks the day before and arrange a halt in production to mitigate the downtime.

This also involves the potential to upgrade to newer machines that do not break down as often.

Maintenance and preventive aspects are a complex discipline that are also available via outside consultants and outside specialty maintenance people for the huge machines that are seen. Mills, draglines and the like are often maintained by specialists who may or may not keep their own men on site. A lot of modern machines have their own internal diagnostics that give you early warnings of problems to come.

I suggest you search for these types of people.

We employ personnel who monitor our equipment with thermal imagery, vibration and acoustic analysis, test the oil and lubricants for viscosity and foreign objects and a few other things. This all falls under predictive maintenance. These folks together can tell us the likelihood of the death of a machine in the near future.

We also perform preventative maintenance to a varying degree of success. In other words, put the fires out first. The better your preventative maintenance program on your equipment, the longer life that it will have. As you have to spend more time putting out fires you have less time to perform your preventative maintenance and the folks in reliability begin to tell you that something is going to fail soon and you have to order in a replacement and get it installed during the non-production hours.

Ideally having a non-production shift crew that can perform preventative maintenance, as their main purpose in life, would be a way to extend the life of any equipment. The reliability crew works during production to take the readings when the equipment is under maximum utilization. They pick up some defects that can be alleviated with preventative maintenance. They have to work together or the program doesn't work.

Outside consultants are great IF management and the bean counters buy into the results. But once again, the first place that they want to cut is maintenance. So go figure. And from what I have seen most consultants aren't telling you anything a good maintenance manager hasn't been telling you for years. Why people want to believe (and pay top dollar for) someone who doesn't have a vested interest in the company before your maintenance manager who has been trying to keep the place running for years with a constantly decreasing budget. And he is the poor guy who had to shell out the coin for the consult.

It's not negative, simply this question is too wide open. Invent any scenario you want and answer in anyway that you want, but to me that is simply story telling unless a lot more specifics are given.

Yes, we need to modernize in North America.

We have been neglecting our industrial infra-structure for 20+ years and the jobs have moved to Asia. In some cases we can blame the corporates while in other cases the blame can fall on the workers' refusal for technology improvement.

We can only compete if we can reduce the production cost. One way is through modernisation. This might mean cutting some production jobs to keep the rest of the factory alive. New process and products must be used to create the new jobs we need. But how to finance this?

One possibility would be to jump on the incentives for energy efficiency and pollution reduction. This could be a win-win situation to keep jobs and reduce pollution.

The developing countries are looking up to us to develop the pollution control and high efficiency process that they need. We won't sell them plastic goodies but we can sell them the clean process to make them.

Ed Weldon is correct.

Accountants and business majors fail to see the benefit of a progressive and skilled maintenance staff as profitable and beneficial since there is not an easy way to show how it effects bottom line profits. In fact it is looked upon as a resource drain only.

That and the attitude that skilled labor is not needed and maintenance personnel are "a dime a dozen". In other words they have no respect for other persons degree's, licenses or accomplishments. Yet in their arrogance they wonder why no one has respect for them.

What is worse is that in downturns in the economy companies have a tendency to reduce maintenance budgets and personnel.

If breakdowns begin to interfere with production. Shut downs to install and commision new equipment also create headaches. I believe the answer lays somewhere in between and it begins at the top. They need to have skilled and experienced advice at the top and actually take thier advice. They also need to understand that no matter what thier decision it will cost a certain amount of money, probably more than they want to spend. The reduction of that money will create a loss in time, equipment, production and quality of product.

Why address any retasking or even layoffs through the portion of the company that provides billable labor instead of overhead. This really leads to a reduction in productivity. Why not layoff some of the overpaid marketing and management personnel, and hire new replacements at a more competitive wage scale, maybe get them on a wage scale more consistent with the Japanese or other foreign industries. We fear losing management or marketing as potential competitors frequently, but if you can cut costs and still provide the production levels and quality customers seek, they can not compete since they would need to work for or start a company that would pay their over priced salaries and benefits (which equates to greater overhead) without any real gain in production or sales. So maybe instead of focusing on how to improve cost effectiveness and efficinency through the lowest workers on the pay scale, you might address more easily how to save money and still be productive through measures directed at upper level management (and their personal staff) or through creative, cost effective marketing.

Maintenance engineers are clearly at fault, they are either too lazy, or too focused on fire fighting to really develop the financial models that will show management how best to manage the business.

As a result the business people who are too damn lazy to really understand the technical issues will do what is easy to meet their financial goals. Usually cutting maintenance expense and parts on hand.

Just a short example, I had a SAP analyst try to scrap a 1 million USD rotor for a compressor because it had not turned in stock in over 5 years. We in maintenance had saved the company several million dollars by improving overhaul frequency from 3 years to 15 years, but we really did need that spare rotor in case of emergency.

A small bit of capital expenditure can save millions in maintenance (as in my example above), but no one will spend the capital without a good financial justification. At the same time projects that are focused on minimizing capital expenditure, always result in huge maintenance expenditure.

We really need to look at life cycle cost, but to do that requires maintenance and engineer types that understand business/finance and communicate in their language, and business/finance people that understand maintenance and engineering. In most organizations, the silos prevent this.

In this environment, the easy choice for engineers is to gold plate and bullet proof the equipment to reduce maintenance cost but that increases capital cost. However as a general rule that will reduce life cycle cost.

You fail to recognize the cause of the decline. Like so many of us, including management, you don't see much beyond the world you live in.

The cause of the decline and the downward spiral is a decline in sales. The product your producing no longer has value to your customer. Be it that your customer has decided to pay down some debt, or to hold cash, the point is they are not purchasing your product.

The smart play is to find a way to survive the downturn so your company will be around when your customer returns.

Some companies are taking this time to develop new products, or improve what they have to offer now. But, R & D does not help production or maintenance. In tight times, they are costs that need to be trimmed to survive.

From the maintenance point, the best way to help the company now, is to find cheep ways to keep the equipment running so the company can react when the customer does return.

Think about it.

Actually even cash flush companies tend to not be using money to invest in things like maintenance and R&D now. They conceive of this time as a opportunity to buy out competitors and cut the labor force to develop a leaner operation. However, they tend to perceive the worng labor force to make cuts in. Typically during those fat times they bulk up on management, HR, Marketing and other non-billable accessories that support the executives, however, when the times get hard they can not lean back on those accessories because the executives have become so lazy and unaware of the operations they now need all those accessories, which developed internal bureaucracy previously for job security and justification. If this happens on too massive a scale the company can not change or lack sufficient flexibility to compete well during these times, and unless it is a massive company that donates a lot of money to presidential campaigns, they might go bankrupt. At any rate the best way to stop a downward spiral is to become more lean, flexible and competitive by cutting costs by reducing overhead staff to a minimum while maintaining production and R&D capacity. Think of management, HR, Secretarial, and marketing as expensive chocolate or starbucks coffee for the executives. Necessary not really so much, but once they are addicted they fight not to give it up, sometimes even making bad decisions like giving up dinner or lunch.

You fail to recognize the cause of the decline.

First of all... We are in an economic downturn.. Let's get that straight. We are in a Stupidity Upturn!

We (you and I) gave the reins to people who did not have our interests at heart, and subsequently, did not accomplish what we hired them to do. They ought to be punished. (Yes, Politicians!)

Secondly, when we discovered that they had stolen all that money.. our response is to let the New Guy print another trillion dollars (without creating a corresponding amount of Value) This just dilutes the money we do have, so you need more paper to purchase the a standard object.

Where is the accountability?

Jail the crooked Politicians. Regulate the Banks and Stock Markets (again), Delete the current type of central bank, and replace with an operating system that supports the growth of wealth by the people, and recognizes and discourages debt generally.

When the Central Bank (Fed, et al) puts money into the economy, they are indebting the country. It is one-sided. When a person company invests, they typically create a partnership, and seek to benefit both parties.. do you see a difference?

It would be pointless to accept the job of correcting the economy withouth being sufficiently empowered to make the necessary changes. It is more important to fix the financial system and eliminate the crime, debt system, and inefficiency than anything else, (infrastructure, energy, etc.)

Otherwise, we will simply continue on the merry-go-round... There is a reason we have this recurring bailout cycle... It's planned that way.

Chris

REVERSING THE DOWNWARD SPIRAL

Focus on market demand by investing in entrepreneurial person/s with the gifted talent to see over the commercial horizon. Supply and demand remains key and is common to all business, not least in the manufacturing and service industries. Consumer demand doesn't decrease, it just changes... Therefore, the quicker one recognizes market change, the quicker one identifies new business opportunity.

Also, the practice of placing manufacturing off-shore to alleged cheap labor economies, is now increasingly proving to have been short sighted. My money is on company's who quickly reverse this, in recognition of MARKET CHANGE.

Brian Davis (London UK)