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Drawing up an Asset

Management plan that delivers


Operational Reliability
John Woodhouse
CEO, TWPL
Chair of Faculty, IAM

The Woodhouse Partnership Ltd 2010

Who we are
Founded 1995 by 8 senior managers from Shell, Philips,
MoD, AEA, Kvaerner
Now 40 consultants/trainers, each with >20 years of 1st
hand asset management & operational experience
Independent, international, multi-industry: clients in 25
countries and most sectors.
Path-finders and hand-holders in Asset Management,
Operational Reliability & Risk Management

Chairmanship of British Standards PAS 55


Chairmanship of IAM Competency Framework project
Project Managers for UK Government MACRO & SALVO projects
10 years of MSc delivery in Asset Management
Blue chip client list, almost all by word of mouth

TWPL provides the grey hair


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What is (good) Asset Management?


Maintaining them?
Sweating the assets?

Investing in them?
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Different levels of Asset Mgmt


Common perceptions
Asset Management = buying &
selling companies

Group/
Corporate Mgmt
Portfolio/network AM

Asset Management = maximising


sustainable return on investments

Business unit/system/region AM

AM = asset care

Equipment AM

Asset
Asset
creation utilisation

Asset
care
4

Asset
disposal

(maintenance, reliability etc)

Optimised life cycles

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PAS 55:2008
Part 1: Publicly Available Specification (28-point
checklist for good practices in Asset Mgmt)
Part 2: Guidance
1st published 2004, updated 2008
50 participating organisations
International (10 countries)
Multi-sector (15 industries)
Over 1300 comments, suggestions & refinements
incorporated
Restructured, clearer & better illustrated

Now moving forward to


become full ISO standard
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Managing the levels in an


integrated, optimized way
Typical priorities & concerns
Corporate/
Organization
Management

Organizational Strategic Goals

Capital investment optimization


and sustainability planning

Manage Asset Portfolio

Sustained
System
performance,
performance,
cost & risk optimization

Manage Asset Systems

Optimize
life cycle
activities

Create
/Acquire

Utilize

Manage
Assets

Maintain

PAS 55 Asset
Management
System

Renew
/Dispose

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Asset Management processes


Capital investment
decisions

PROJECT
Mgmt
Materials

Project Design
& Construction

CHANGE
Mgmt

Operating &
Maintenance
Strategies

RESOURCE
Mgmt

Labour

Resource planning
& task assignment

EVALUATION
of Solutions

Root Cause
INVESTIGATION

Supply
Chain

CONTINUOUS
IMPROVEMENT

Inspection
& Condition
Monitoring

Work programme
scheduling

WORK
Mgmt
Data Collection
Preventive, Detective
& Corrective actions

Problem/Oppty
IDENTIFICATION

Corporate
governance
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The vital lubricants


PEOPLE

Understanding & education


Motivation
Leadership
Collaboration & communication

DATA/INFORMATION

What data, why?


Quality, related to criticality
Timeliness & availability
Usage with knowledge management

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Getting the best from the current best practices

RCM & RBI

Quality Management

Function + failure modes + consequences


+ logic rules = maintenance strategies

Customer focus + teamwork + data analysis


= improvement opportunities

IMPLEMENTATION SKILLS
Customising + culture impact + home ownership

= sustained success

RCA & Cost/risk methods

TPM & Org. Change

Root Cause Analysis, lost opportunity costs


+ risk assessment = business impact

Teamwork + OEE alignment + attention to detail


+ human issues = motivation & communication

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Effort & results

Iterative improvements

Risk-based alliance
contracting

Life Cycle Costing & Optimisation

Maintenance Strategy Review (RCM, TPM, RBI)

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Joined-up Asset Management: the biggest challenges


Legal and stakeholder requirements and expectations

(customers, shareholders, regulators, employees, suppliers, society)

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Other organizational
requirements
and systems

Organizational
Strategic Plan

Asset Management Strategy


Asset Management Objectives
Asset Management Plans

Continual
improvement

PAS 55 Asset
Management
System

Portfolio of asset systems and assets


(diversity of types, criticalities,
condition and performance)

Organizational
values,
functional
standards,
required

Acquire/Create

processes

Renew/Dispose

Utilize
Performance
and condition
monitoring

Maintain

Asset Management Enablers

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The Woodhouse Partnership Ltd 2010

Organizational Strategic Plan (OSP)


Planning

Asset Management Policy


Mandated requirements, overall intentions/principles and framework for control of asset management

Asset Management Strategy


Long term optimized and sustainable direction for the management of the assets,
to assist in delivery of the organizational strategic plan and apply the asset management policy

Asset Management Objectives


Specific and measurable outcomes required of assets, asset systems and the asset management system

Asset Management Plans


Actions, responsibilities, resources and timescales intended to implement the
asset management strategy and deliver the asset management objectives

Implementation

Life Cycle Activities


Functional
Policies, Strategies
Standards,
Processes,
Procedures

Organization values, prioritization criteria and risk policy

Vision, mission, values, business policies, stakeholder requirements, goals and risk management

Assets

Create/Acquire

Portfolio of asset systems


and individual assets

Utilize
Maintain
Renew/Dispose

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Optimized management of the


assets and their life cycles

1. Individual intervention
optimization

Diverse asset needs & opportunities


(types, criticalities, condition, performance)

Is is worth doing and,


if so, when?

3. Activity program
optimization

Construct/acquire

e.g. outage strategy &


capital invest. programs,

Utilize
Maintain/modify
Replace/dispose
2. Asset life cycle optimizations

What is best mix of investment, utilization, maintenance, lifespan & risk?


a) Component/equipment level (life cycles)
b) Systems levels (sustainability)

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Asset Management maturity


& development planning

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IAMs Maturity Scale

Innocence

Learning

Applying

Awareness

Embedding

Development

Optimising
& Integrating

nce Competence

Innovating

Excellence

Maturity Level 0

Maturity Level 1

Maturity Level 2

Maturity Level 3

Maturity Level 4

The elements
required by PAS 55
are not in place.
The organisation is in
the process of
developing an
understanding of
PAS 55

The organisation has


a basic understanding
of the requirements of
PAS 55. It is in the
process of deciding
how the elements of
PAS 55 will be applied
andhas started to
apply them

The organisation has


a good understanding
of PAS 55.
It has decided how
the elements of PAS
55 will be applied and
work is progressing
on implementation

All elements of PAS


55 are in place and
are being applied and
are integrated.
Only minor
inconsistencies in
application may exist

Using processes and


approaches that go
beyond the
requirements of PAS
55. Pushing the
boundaries of asset
management
development to
develop new concepts
and ideas

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The Woodhouse Partnership Ltd 2010

Assessments & certification against PAS 55

Consistent scoring & maturity scales (IAM: 5 levels)


Stakeholder confidence (evidence of good governance)
Prioritising & coordinating improvement plans
Regulatory requirements
Benchmarking etc.
4.1.0

4.6.0

4.2.1

4.5.4

4.2.2

4.5.3

4.3.1

4.5.2

4.3.2

4.5.1

4.3.3

4.4.7

4.3.4

4.4.6

4.3.5

4.4.5

4.3.6
4.4.4

4.4.1
4.4.3

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4.4.2

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Example results from Interactive Assessment


AM processes section

i ng
d
ce
s
e
n
e
n
s
c
c
a
e
e
t
n
t
n
lle
pe
ce
ren
e rs
e
o
a
d
m
c
Un
In n
Ex
Aw
Co

Supply chain processes

Maintenance processes

Projects & Investment


Life Cycle Costing
Projects & resource prioritisation
Major project delivery/completions
Minor projects evaluation & delivery
Mtce/Ops feedback into projects
Risk evaluation & management
Now
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In 1 year

In 3-5
3 years
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Building a robust, deliverable plan

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Top-down & Bottom-up


AM directional clarity
Direction, criticality & weighted objectives

Culture,
Attitudes,
Motivation,
Leadership

Enablers

Enablers

Organisation
Design, Training,
Communications

AM delivery tools
A) What is worth doing, when (RCM, RCA, TPM, APT, CI etc.)
B) How best to deliver it (EAM, CMMS, CPM, MRP, CRM etc.)
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TWPL AM Roadmapping process


Facts of life (stakeholder expectations)
Strategic issues & imperatives

WHY

Roadmap KPIs
Performance & Sustainability goals

ROADMAP

Criticality & Root Cause Analysis

Resources de-bottleneck

Critical, treatable underlying issues


Alignment/gap analysis
New
requirements

High Value Activities

Interdependencies
Urgency bands

WHEN & HOW

Value-for-money bands
Costs, Benefits & Confidence
Other
commitments
Legal obligations
PAS 55 gaps

Benefits Types & Leadtimes

WHAT

Scope refocus (value)


Efficiency Clustering
Real projects & opportunities

Ideas, initiatives, project proposals

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The Woodhouse Partnership Ltd 2010

Example Asset Management Roadmap

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Achieving continuity & cumulative success

Effort & results

Sensitive linkage #2
Rolling out the next initiative
while stabilising/embedding the previous
Sensitive linkage #1
Exploring a new topic during peak
implementation effort for another

e.g. Shared risk/


reward alliancing

e.g. LCC methods


adoption

e.g. AM education
programme

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The Woodhouse Partnership Ltd 2010

Value Realisation
Each IAM maturity step delivered about 10%
improvement in total company performance
Tennet networks, Holland 2009

years
4
n
i
h
t
i
w
x
total Ope
life costs
in
le
o
n
h
io
w
t
c
s
t
u
c
d
e
je
O&M savings 50% r
major pro
in
g
n
i
v
a
s
s held
e
%
r
0
a
2

p
s
in
s
Life Cycle Cost savings
able saving
n
i
a
t
s
u
s
%
5
2

Bottom line impacts

Lower inventory/fixed costs

Performance gains
Service quality improvements 28-50%
reduction in
planned dow
Risk reductions
ntime
60% re
duction in sa
fety incident
s

Culture change

Ownership & motivation


Creativity & continual improvement

Priceless!

Credibility
Regulatory approvals
Customer impression
Company reputation

Reductions in regulator challenges/questions


Customer satisfaction survey results
Credit rating, goodwill/brand in balance sheet, M&A values

Every organisation has


unique assets &
circumstances, so every
roadmap is different
but it helps if the whole
organisation is driving in the
same direction!

John Woodhouse
www.twpl.com
john.woodhouse@twpl.com
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The Woodhouse Partnership Ltd 2010