BUSINESS IMPROVEMENT

TECHNIQUES
Analyze and evaluate a business case to provide improvement suggestion

JUNE 9, 2017
Wael Juma ALwarrfaly
Pearson BTEC Level 5 HND in Operation Engineering
 Business improvement techniques | Wael

Task.1.1
The lead time of the refining process as shown in the schedule is 99 hours
1. Receiving the crude oil from the oil field and the crude is stored in the
crude oil tank for eight hours for settling and drain the water.
2. The preheating of the crude oil in the heat exchanger and the heating
process in the furnace for 5 hours
3. Distilling the crude oil in the distillation tower for one hour
4. Cooling the products by heat exchanger after that by fan coolers for one
hour
5. Storing the products in the storage tanks for settling, drain water, and
taking samples to make proper tests before transferring it to the shipping
tanks.
6. After transferring the products to the shipping tanks the shipping pumps
are started to send the products to the costumer and this process will take
around 36 hours.

cooling
receiving heating distillation products storage shipping
8 5 1 1 48 36
 Business improvement techniques | Wael

Task.1.2
It can be observed from the frequency diagram below that most of the process
stages are executed in time that less than 10 hours. With the exception, the
storage and shipping stages which are considered as bottlenecks because they
take the most of the lead time of the process.

the lead time of the refining process

60

50

40

30

20

10

0
shipping storage cooling distillation heating receiving
product
 Business improvement techniques | Wael

Task.1.3
Fish bone diagram

Lack of
routine
Line diameter is
maintenanc
not sufficient.
e

Absence of
machines Design calculations
spare parts was not accurate.
Long
storing
periods

Efficient pumps is
not available in
refinery stores

Lack of
manpower Pump flow rate is
low
 Business improvement techniques | Wael

Task.2.1
In the oil refinery the refining process can be improved and the improvement that
can be applied is the reduction of the products storing period by eliminating the
storing stage.
 Business improvement techniques | Wael

And storing the products in the shipping tanks and these tanks and can do both
functions (storing and shipping). Also the shipping process can be decreased by
changing the shipping pumps with pumps that have higher flow rates which will
decrease the shipping period. And by these two improvement the lead time of the
process will be decreased.
 Business improvement techniques | Wael

Task.2.2
Diesel tank
For diesel tank we suggest to improve the tank according to the API 620 standard
Which guide for construction of tanks with
 Internal pressure up to 15 psi.
 Almost constructed by welded carbon steel.
 For large tanks which are assembled in refineries and are used for storage of
petroleum products.

Gasoline and kerosene tanks

For gasoline and kerosene tanks we suggest to improve tanks according to API 2519
standard.
 Covered by internal floating roof to prevent evaporation losses. Effects of
internal floating covers on tanks operation as well as the provisions for
gaging, sampling, and temperature reading are described in the document.
 Almost constructed by welded carbon steel.
 For high capacity tanks which are assembled in refineries.

Task2.3
For the potential defects that maybe happened such as the products run out of
specification for this defect the proper response for this problem is by increasing
laboratory routine sample check and the laboratory tests should be every hour
instead of 6 hours. And by this action the operators will be more aware of the
products situation
Also the new pumps the routine check and maintenance should be implemented
to avoid pump failure during shipping the products by daily check which is
implemented by the operation or maintenance crews and changing the damaged
parts before the interruption of the shipping process occur.
 Business improvement techniques | Wael

Task.3.1

Elimination of main problems

Elimination of the main problems is the most important and the first TPM step.
Eliminating main problem will make the culture support stronger. By doing this, as
an oil refinery we illustrates that we are aware of our process, and we have a
plan, also illustrates that we setting aims and implementing them. And by this
action all employees will be motivated to be aware of the refining processes.

Autonomous maintenance
In Sarir refinery Autonomous maintenance is known as daily check which is the
routine maintenance and it is done by the operators and it includes
 Cleaning the equipment's and the area surrounding it
 Lubricating the machines such as pumps and compressors
 Daily inspection
Autonomous maintenance or daily check increase the knowledge and the
experience of the operators about their machines and equipment, also to ensure
that all the equipment are lubricated and clean.

Planned maintenance
The planned maintenance it is the maintenance which is scheduled and it is
based on the prediction and the measuring of the failure rate, and by using the
planned maintenance the unplanned stop time will reduced significantly, also will
give the opportunity to maintenance groups to know when the equipment is not
scheduled for production to give them the opportunity to maintain it.

Early equipment management

Early management helps to orient the practical knowledge and experience, and
helps to understand the manufacturing specification which gained by TPM to
improve the design of new machines. And by early equipment management the
planned performance levels can be easily and much faster reached by the new
machines.
 Business improvement techniques | Wael

Education and training on job (OJT)

Training and education is necessary to reach the TPM goals, also to eliminate the
gaps in the knowledge by training the operators their skills will be developed
which will help them to recognize the emerging problems. Also will help the
maintenance groups to consolidate their maintenance techniques and experience
also will improve them for preventative and proactive maintenance

Task 3.2
In case the power failure and the standby generator doesn’t start and the
shipping tanks are full so the third pump with a diesel motor should be installed
to be on standby position if the power failure and the two main pumps with
electrical motors cannot be used so the third pump with diesel motor is used to
continue the product transfer.

In case of the product goes out of the specification and the laboratory technician
does not discover that immediately or he does not inform the operation
department to correct the failure and the product tank goes out of specification
so the product should be transferred to the slop tank so recycle line with a pump
is need to be installed.
 Business improvement techniques | Wael

Task.4.1
Solving the problem by using the OPT principles
Identify the bottleneck
As it was found before that the bottleneck in our process was at storing and
shipping stages and it can be seen in the frequency diagram that these two stages
talk the most of the lead time of the process.
 Business improvement techniques | Wael

the lead time of the refining process

60

50

40

30

20

10

0
shipping storage cooling distillation heating receiving
product

Increase the capacity of the bottleneck

In the refining process the increasing of the bottlenecks capacity can be
implemented by eliminating the storing stage and using the shipping tanks for
both functions (storing and shipping) and by this edition the lead time of the
process will be reduced by 48 hours, also the operation cost will be reduced
because the cost of the pumps electricity and pumps motors maintenance
such as lube oil and spare parts will be eliminated.
Shifting the work off of bottlenecks
Shifting the work off can be implemented by using two pumps instead of one
pump in shipping stage and by this action the effort will be divided to two, and
the flow will two time higher than before which will reduce the shipping time
to the half and the shipping stage will be 18 hours only.
 Business improvement techniques | Wael

SWOT analysis for Sarir refinery

Strengths Weaknesses
development and improvement of the production
distribution network is strong technology
the refinery revenue is increasing
annually cost of environmental hazards and legal issues
financial position is strong lack of LPG production process

Opportunity Threats
buying process is easy price of crude oil is increasing
energy demand is increasing the competition in fuel sector is high
the price of equipment and spare parts is
fuel prices is increasing increasing
new oil fields discovered near the
refinery

strengths weeknesses
distirbution network is strong development and improvement og the production technology
the refinery revenue is increasing annualy cost of enviromental hazards and legal issues
financial position is strong lack of LPG production process
opportunity
buying process is easy
energy demand is increasing
fuel prices is increasing
new oil fields discovered near the refinery

threats
price of crude oil is increasing
the competetion in fuel sector is high
the price of equipment and spare parts is increasing
 Business improvement techniques | Wael

Task.4.2

The refinery performance measurement for the last year

Product quality
The products was produced according to the specification of the NOC and they
were tested and completely accepted by the NOC team so it can be considered as
100%

Production
Diesel
The target of the diesel production per year was 1204500 barrel and the diesel
produced was 1206320 so the percentage of diesel produced to the target was
100.15%
Gasoline
The target of the gasoline production per year was 396200 barrel and the gasoline
produced was 398886 so the percentage of gasoline produced to the target was
100.67%
Jet fuel
The target of the jet fuel production per year was 168270 barrel and the jet fuel
produced was 168520 so the percentage of diesel produced to the target was
100.14%

Crew attendance
The operation department attendance sheet illustrates that only 7 times without
informing the shift supervisor or the department head and in 25 times the
permission was taken from shift supervisor or the department head.
 Business improvement techniques | Wael

Task.4.4

To the leadership
Obviously, that the processes of the refinery need an improvement and there is a
lot of improvements that could be applied to these processes, the most effective
and beneficial to the refinery will be mentioned in this report.
It can be seen in the analysis that the storing and shipping take the most of the
lead time of the process and the improvement that I recommend to apply on the
refinery to enhance the throughput while reducing the operation cost is that
removing the storing stage and using the shipping tanks for both function and by
this action the lead time of the process will be less by 48 hours also will eliminate
the operation cost of the storing stage which includes the pumps motor
electricity, the cost of lubricating oils, and the cost of maintenance and spare
parts.
Also another improvement that could be applied to decrease the time of the
shipping stage is by replacing the old pumps with new pumps which have higher
flow rates which will decrease the periodic time of the shipping stage and the
products will be reachable to the costumer faster than before.
 Business improvement techniques | Wael

References.
Management basics … Susan Quinn… ISBN 978-87-7681-717-6

Project management … Jack R. Meredith …. Samuel J. Mantel, Jr…. ISBN 978-0-470-22621-6

http://www.leanproduction.com/tpm.html