Companies are willing to invest millions of dollars to get the latest equipment and improve performance. Getting the facts about the maintenance liability is an essential part of the investment analysis because if the maintenance liability is under-estimated, the ROI is over-estimated. Unachievable ROIs and misunderstood maintenance liabilities trigger other problems that have long-lasting effects, such as:
- Flawed long-term plans are used for years as inputs to budgets.
- Unachievable production targets are given to plants, setting them up for failure and creating mistrust between management and the workforce.
- Management teams make promises they can’t keep to the Board of Directors and shareholders about operating and financial performance; as a result, the credibility loss suffered by executives and management teams is significant and, in some cases, career changing.
Old perspectives about maintenance activities are the root cause of misunderstood or under-estimated maintenance liabilities. A new perspective would change how you value maintenance. What if you viewed equipment maintenance as an opportunity to schedule and coordinate major repairs on equipment along the value stream? Further, what if departments other than maintenance viewed it as an opportunity to create future uptime, reduce cost, prevent failures and equipment damage, and extend equipment life? It is possible to do this under the umbrella of what I call a master operating strategy. A master operating strategy “bundles” the downtime required for maintenance of large productive units found in different production functions. One block of time contains several simultaneous planned maintenance jobs, similar to a precisely planned and executed shutdown.
If you are interested in achieving your best performance (i.e., optimizing performance), you need to know about master operating strategies. Why? Because they help remove the barriers that prevent poor cooperation between departments. Cooperation between departments is essential to optimizing performance because many costs and production losses are associated with poor working relationships between departments. Master operating strategies require agreement and collaboration between operations, maintenance, safety, procurement and the warehouse (at a minimum). Master operating strategies bring people together to accomplish a single goal, which is a different mission than managing one department or division. Master operating strategies also help shift a culture from reactive to proactive and will change the way management teams interact to solve problems and manage projects.