UNIVERSITY OF PRETORIA

RELIABILITY ENGINEERING

Economics
Maintenance
Practice MII 420
Dr. Barend Botha

Dr. Coenie Thiart

2nd Semester 2012

Maintenance Practice
1
MII 420
Maintenance Engineering MII 420

1.2 Maintenance Maturity

2nd Semester 2012

Prepared and presented by Dr C Thiart
 Maintenance Maturity Indexing
Stage 1 Stage 2 Stage 3 Stage 4
800

700

600
ROI =
Total Maintenance Cost

500
10 X
400

300

200
CRP =
3X
100

0
10

13

16

19

22

25

28

31

34

37

40

43

46

49

52

55

58

61

64

67

70

73

76

79

82

88
85
1

Quantum Planning +
Control Congruence Empow erment
Leaps: Basics

TIME (not realtime )

3
Handout
 Maturity Indexing Notes 1
1. The graph cross-references Total Maintenance Cost
(Ratio) to Maturity - expressed as Time (not REAL
Time)
2. Four stages is the best fit to the graph's minimum
and maximum
3. Stage 1 is a mess; Stage 4 is the place to be
4. Cannot start at Stage 4; Must follow 1-2-3-4! There
is no other way but the logical sequence!!

4
 Building blocks/ activities Stage 1
• 1) High vertical axis – RTF (run to failure)
• 2) Planning
• 3) Solve commissioning problems
• 4) Activities to increase reliability
– 4.1) RCM
– 4.2) Root cause analyses
– 4.3) Maintenance Practices
– 4.4) Preventive maintenance
– 4.5) Predictive Maintenance
– 4.6) Quality control
– 4.7) Maintenance Management
– 4.8) Resource management
– 4.9) Stores management
– 4.10) Reliability simulation
– 4.11) Statistical analyses
– 4.12) Etc
 Notes – Stage 1
• Cost reduction benefit is 3X to 7X in Stage 1
and 2
 Control Standards – Stage 2
1. Planning!
2. Supervision & Approval
Competencies (# Signatures)
3. Rules and Regulations
4. Standards & Specifications
5. Apply the principles developed in
stage 1
8
 Notes - Stage 2
• More than 80% of organizations are stuck in
Stage 2 because they believe in the fallacy of
"Minimum Cost"
 Congruence – Stage 3
• TPM - Total Productive
Maintenance
• Alignment / Balance
• Synergy & Assistance
• Working together to achieve a
common goal
• Common priorities
• X-Functional Problem Solving
10
 Notes –Stage 3
5. Cost increase in Stage 3. Why?
6. ROI = 10X in Stage 3, provided it is managed
7. Unfortunately you do not see the 10X returns on
the maintenance budget (invisible, opportunities)
8. Red line dividing Stage 2 and Stage 3: To the left of
it employees get paid for being in attendance; To
the right of it employees get rewarded (not only
paid) for performance
9. There are no job descriptions in stage 3 & 4! They
have been dispensed with as being unnecessary
limiting

11
 Notes –stage 3
5. In Stage 3 it becomes very difficult to
distinguish between maintenance and
production employees because they work in
almost perfect synergy

6. (unions)
 Empowerment – stage 4
Empowerment means allowing
your employees to do the right
thing without asking permission
– this will now speed up the
entire process

13
 Notes – Stage 4
15. The biggest problem that companies have is the
unfocused approach towards maturity. In other
words they try to a little in Stage 1, a little in Stage
2, Stage 3, and Stage 4. But these attempts do not
follow a logical sequence, moreover, it causes
imbalance!!! And worse – Some activities in later
Stages are in contradiction to those in earlier
stages, mainly due to reduced control. (e.g. Job
descriptions)
16. Stage 3 & 4 organisations are NOT good at fixing
breakdowns!

14
Relationships
The Maintenance Cost Ratio

16
 Direct Cost vs. Indirect Cost
Visible Invisible (Hidden)
Labour Overheads
Spares Downtime
Lost opportunity

17
 Stage 1 Cost Distribution

Labour

Dow ntime Spares

 Direct Cost vs. Indirect Cost
High Worst
1

3
4
Direct
Cost

Low Best

Low Indirect Cost High

19
 Direct Cost vs. Indirect Cost
High Worst
1

3
4
Direct
Cost

Low Best

Low Indirect Cost High

20
 Direct Cost vs. Indirect Cost
High Worst
1

3
4
Direct
Cost

Low Best

Low Indirect Cost High

21
 Direct Cost vs. Indirect Cost
High Worst
1
5
2
4 3
4
Direct 3
Cost

1
Low Best

Low Indirect Cost High

22
 Direct Cost vs. Indirect Cost
High Worst
1
5
2 4+52 = 56
4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High

23
 Direct Cost vs. Indirect Cost
High Worst
1
5
2
4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High

24
 Direct Cost vs. Indirect Cost
High Worst
1
5
2 2.7+64 = 66.7 (56)

4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High
25
 Direct Cost vs. Indirect Cost
High Worst
1
5
2
4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High

2+28 = 30
26
 Direct Cost vs. Indirect Cost
High Worst
1
5
2
4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High
4+10 = 14 (30)

27
 Direct Cost vs. Indirect Cost
High Worst
1
5
2 2.7+64 = 66.7

4 3
4
Direct 3
Cost

1
Low Best

10 20 30 40 50 60 70
Low Indirect Cost High

4+10 = 14
28
 Financial Viewpoint

I have heard accountants asking why

we spend so much money on
preventive maintenance when we
never have any breakdowns
Christer Idhammer
 References
• Notes – H Ellis
Questions?

???
31