16s-1 Maintenance

Chapter 16 Supplement

Maintenance

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-2 Maintenance

Introduction
• Maintenance
– All activities that maintain facilities and equipment in
good working order so that a system can perform as
intended
• Breakdown maintenance
– Reactive approach; dealing with breakdowns or
problems when they occur
• Preventive maintenance
– Proactive approach; reducing breakdowns through a
program of lubrication, adjustment, cleaning, inspection,
and replacement of worn parts

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-3 Maintenance

Maintenance Reasons

• Reasons for keeping equipment running

– Avoid production disruptions
– Not add to production costs
– Maintain high quality
– Avoid missed delivery dates

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-4 Maintenance

Breakdown Consequences
• Production capacity is reduced
– Orders are delayed
• No production
– Overhead continues
– Cost per unit increases
• Quality issues
– Product may be damaged
• Safety issues
– Injury to employees
– Injury to customers

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-5 Maintenance

Total Maintenance Cost

Table 16S-1

Total Cost
Demand

Preventive
maintenance cost

Breakdown and
repair cost

Optimum Amount of
preventive maintenance

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-6 Maintenance

Preventive Maintenance
• Preventive maintenance: goal is to
reduce the incidence of breakdowns or
failures in the plant or equipment to
avoid the associated costs
• Preventive maintenance is periodic
– Result of planned inspections
– According to calendar
– After predetermined number of hours

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-7 Maintenance

Example S-1

Frequency of breakdown

Number of breakdowns 0 1 2 3
Frequency of occurrence .20 .30 .40 .10

If the average cost of a breakdown is

$1,000, and the cost of preventative
maintenance is $1,250 per month, should
use preventive maintenance?

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
 16s-8 Maintenance

Example S-1 Solution

Number of Frequency of Expected number of

Breakdowns Occurrence Breakdowns
0 .20 0
1 .30 .30
2 .40 .80
3 .10 .30
1.00 1.40

xpected cost to repair = 1.4 breakdowns per month X $1000 = $1400

reventive maintenance = $1200
M results in savings of $150 per month

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-9 Maintenance

Predictive Maintenance

• Predictive maintenance
– An attempt to determine when best to
perform preventive maintenance activities
• Total productive maintenance
– JIT approach where workers perform
preventive maintenance on the machines
they operate

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-10 Maintenance

Breakdown Programs

• Standby or backup equipment that can be

quickly pressed into service
• Inventories of spare parts that can be installed
as needed
• Operators who are able to perform minor
repairs
• Repair people who are well trained and readily
available to diagnose and correct problems
with equipment

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.
16s-11 Maintenance

Replacement
• Trade-off decisions
– Cost of replacement vs cost of continued
maintenance
– New equipment with new features vs maintenance
– Installation of new equipment may cause disruptions
– Training costs of employees on new equipment
– Forecasts for demand on equipment may require
new equipment capacity
• When is it time for replacement?

Operations Management, Seventh Edition, by William J. Stevenson

McGraw-Hill/Irwin Copyright © 2002 by The McGraw-Hill Companies, Inc. All rights reserved.