Write this assignment like an engineering investigation report with a business case recommendation. The audience will be the director of engineering and general managers. The objective for option A is to present a business case for investment into improvement (with sound technical justifications) and for option B is the asset management plan for new assets/plant/production line.
Maintenance of company assets is a crucial thing every management should try and work on to enhance the operations of the organizations since most of the company’s operations are run by the ability of the firm to manage its assets better to ensure that disruptions in running the firms activities both in short and long-term (Council, 2012). A company which operates its asset better is in a better position of ensuring that it can meet all it client needs better and sound. In engineering setting, most maintenance involves applying grease to the company machines, applying depreciation, servicing them periodically and tracking their performance to ensure that all runs as expected (Wenzler, 2005). Most organizations in the world have a title or a job position for asset managers who ensure that all assets within the organizations are taken care and are not tampered with at any point in time. The job description of the same person defines the ability for them to inculcate necessary measures that will ensure the company assets have not been misappropriated or used for the purpose not meant (Haynes et al., 2017). Any attempt to use company assets for personal gain. Unmaintained assets cause the company to incur unnecessary costs which could have been avoided if at all necessary precautions were taken t ensure that everything runs smoothly and efficiently (Schneider et al., 2006). Every organization tries at all times to maintain happiness to its customers, and thus it has an obligation of ensuring that all its assets are perfect and at all times in special working conditions. Besides, that the company focuses to ensure that it can manage all its business without disruption of providing services or derailing in the production of commodities to its customers. At entirety, an organization should focus to ensure that all machinery is delicate and can execute their operations flawlessly (Brown & Humphrey, 2005). Therefore, the asset maintenance task is vital for any organization in services to ensure maximum production and execution of activities as and to when expected by the management (Hansen et al., 1999).
Every asset has a given useful life, that is, the life it can perfectly perform before its salvage value drops to zero. Engineering companies deals with non-current assets as revenue generating vehicles (Ouertani et al., 2008). This means that, they have a duty of maintaining the assets and ensure it is in proper working condition and can work optimally within the shortest period to produce results. Ways of optimizing performance should be designed to ensure that the machinery is in proper condition at all times and this boosts the organization confidence in all material aspect (Davis, 2001). Getting high quality and physical asset utilization and asset performance a firm need to have high coordination of activities within it and need to match that with life of the assets to ensure that it does not deviates to the core objective of the organization (Dierickx & Cool, 1989). Different organization has implemented different means of ensuring their assets produce the best quality over and over again (Bolton et al., 2004). Through continuous production they are able to ensure that they meet the needs of their clients on a perfectly daily basis and at a cheaper fee. Therefore, continuous maintenance of such assets make a lot of sense to the person managing the assets in the long term (Thomas, 1999). The asset managers should be able to draw a correlation between the kind of data that have been mined and how it relates to the production of the organization. This helps the firm in making timely and informed decisions that safely and profitably maximizes the performance and add values of the enterprise physical assets. By establishing the relationship one is in a better position to understand when the asset is underperforming and when it is at peak of productions (Grieg-Gran et al., 2005). It explains why most organizations assets are serviced by every time to ensure there are down times and that production is always at the peak to facilitate proper running of the activities as long as the firm is operating in a practical world. Before a firm decides the optimization level of an asset, it has to develop key performance indicators that it will measure its assets against (Gault et al., 2005). Equally important the firm should identify areas where the company is likely to generate losses as a result of using the assets in question. There are various KPIs that have been generated to measure the firm’s performance in terms of: plant and design development, operations planning, process control management, reliability analysis and planning, asset maintenance implementation, asset condition monitoring and analysis, procurement stores and financial, environmental sustainability and safety and regulatory compliance. The engineering and safety unit’s stands at a better chance of outlining what the asset optimization will be measured against (Shukla & Van Inwegen, 1995). Some organization have even developed group of people who are tasked on ensuring that company assets are always on safe hands at all times. The Key Performance Indicators must have a financial implication when they are controlled (Myers, 1984). The following paragraph explains the different KPI for asset optimization and utilization:
The initial purpose of the KPI is to determine the production downtime, reducing maintenance and overtime cost and reducing the cost of spares (Grossman, 1987). After that, the study on the criticality of production is studied relating to productions asset to their impact on future production annexures if any for the organization and safety and regulatory compliance come into play to affect the same (Wheeler, 2003). Contingency plan for the unplanned and unforeseen costs are developed and enacted to the program to ensure that all is running smoothly and efficiently with minimal interruptions from the third parties. An optimized balance of CBM, PPM, Precision Maintenance and Breakdown structure should be maintained at all times to improve the operation of the organization maximum (Schuman & Brent, 2005). The later builds a shape reliability driven maintenance execution and reliability feedback activities. The management should be tasked with a duty of ensuring whatever modification dons to the machinery are in line with the reliability plan guideline at all times to prevent recurrences of such happenings in future (Brown, 2012).
Most machinery processes affect the quality, availability, capacity, safety, risk, and cost can be progressively be evaluated throughout an assets lifetime (Kaplan & Norton, 1996). It is critical to identify impending impediments, and hence its application becomes essential in critical areas identified in reliability plan (Madhok, 2002). The asset managers should seek to understand the current state of health of a process or an idea and counter run it against the current performance information. The two diagnosis and prognosis plays a pivotal role in determining and predicting the useful life of assets optimizations based on quality and rate of production (Fung & Hsieh, 1997). Due to continuous dynamics, organizations are working to ensure asset manager use plain data that will provide that they can generate results for performance effectively and efficiently.
The results from reliability plan are used as an input to enhance conservation and implementation of the findings and recommendation from the previous process. The input required for asset optimization include maintenance resource availability, asset and problem histories and work order planning and scheduling (Afuah & Afuah, 2003). Additionally, tracking plays a very pivotal role in ensuring that all were running as expected. The stage provides that the plant can produce and meet the expectation set by reliability plan. Failure to impress its inbuilt system, maintenance alone cannot help in rectifying the problem (Sharpe, 1992). Therefore, it means that the production performance must be revised or lowered to meet the desired expectation of the user.
These involve the standard operating functions of monitoring and controlling the process for reasons of safety and product specifications. Besides, there is invaluable information to be received from the process measures that can provide an understanding of the present health of the assets. The system should also be in a better position to understand the bottleneck or backlogs that relate to a particular machine and generate ways of offloading the issues to enhance production stream and aid in optimization (Magruder, 2008). Due to continuous maintenance process, the machinery may become complicated and there can be chances of the constrained production rate of the motor due to continuous production.
Planning is a vital role in every organization and management should be tasked with a role in ensuring that everything runs smoothly and as expected. To effect smooth operations the administration to design relevant strategies tailor-made to the need and requirements of the organization machines to the point that they do not interfere with the production rate of the organization in both short and long-term running of the organization (Musmanno et al., 1999). The process tends to integrate the supply chain of the organization and define mechanism upon which delays in procurement process will be to a high degree be mitigated. The objective of asset maintenance process is to reduce costs and ensure all activities are run at a quite fast pace in reference to set targets (Amadi-Echendu et al., 2010) All the material used for products such as steam, fuel, gas, power, raw material and other relevant materials should be in place to promote optimum productions. All engineering machinery should be safe to use and should interfere with the employees on performance basis because that would lend them ineffective.
It is always essential for a firm to consider the actions of its assets at all times to improve the machinery generation power or production power. The continuous review helps the organization establish problems when they arise and develop the mitigation measures of the same. This ensures that management is in a better position to know how effective are their assets and what can be done to make them better (Lampe & Strassner, 2003). The management must make sure much has been done to facilitate the effective running of the company assets every day and at all times to improve performance and effectiveness. Any laxity or inconsistencies in checking the state of the machines may cause them to crumble and leave the business in a lousy state of operations (Michaud & Michaud, 2008). Therefore, it is the sole mandate of the firm to ensure that maintenance has been and that regular checks are carried on a continuous basis not only when the assets are not in proper working condition.
Various strategies can be employed by an organization in ensuring that the firm runs its operations smoothly and effectively (Cohen & Hammer, 1967). Asset maintenance and management system is sound when it can identify the assets of the organization, understanding the location of the assets, understand the current condition of the company assets, comprehend the design nature of company assets, can develop an asset care system and acknowledge and perform all of the activities above and generate information which can be relied on making judgements (Saunders, A., & Thomas, 1997). The strategies will be explained as under:
Run to Failure: it means that an organization runs a machine entirely until the device cannot function anymore, at this point the engine has to be repaired for it to continue operating normally. However, the process can be expensive and stressful especially when the firm has no backup plan since a machine can fail entirely to work (Jones & Sharp, 2007). The strategy is critical but only work for the equipment’s which are not always used for daily operations of the organization. The process of maintenance incurs a low cost but can be disastrous especially when the firm fails to meet all its production costs (Wilson, 2002). Most of these equipment tend to run at high values of maintenance and replacement for quite an extended period, and it is an expensive way of maintaining the firm’s assets.
The process involves a periodic review of assets by setting the offline for repair purposes through inspections and repair. The predetermined interval reduces the chances of a particular machine breaking down and failing to work entirely. It is a simple strategy to maintain the assets, but it causes the firm to incur high costs of repair and may lead to disruption of business activities of the organization (Ait-Kadi 2009). It has proved to be much costly in the long run compared to other ways of managing the company assets. It is more of a predictive measurement model since it projects that something might fail to work about a particular asset. For one to use the model, strict and keen scrutiny should be carried on the process to ensure that there is little disruption of activities.
It is a condition tied to maintenance strategy. It forecast the failure before it materializes rather than waiting for the failure or non-functionality of the equipment to happen. It is very possible to execute out PdM via visual inspections of the material but the simplest way to establish a predictive maintenance strategy is by use of a CMMS to track meter readings at all times. The plan is better than any other since it helps in reducing potential costs that are as a result of repairs and maintenance of assets. It also provides ways of saving possible cost from reduced person-hours spent on support and more insights as to the performance and potential problems arising with the machine.
Failure of equipment is not always linear to be predetermined or a model to be developed for tracking the failure of a machine. RCM is a strategy that addresses the issue in depth. That is, it is a highly involved process that seeks to understand and analyze all the possible failure modes for each piece of machine and customize a maintenance strategy for each case. The most exciting thing to note is that there is no a single way of managing the organization machinery, different ways suit different machines. For example, a device that is regularly used for the specific production of various commodities should be maintained periodically to improve their operations and increase the production capacity. The model is complicated to be realistic to any organization all over the world. It requires an organization that has decent maintenance teams, understands the predictive model and the firm’s own much of the assets information which helps them make informed decisions relating to their use. Intelligent diagnostics based maintenance is dynamic asset management technique that is providing organizations with the power to prevent downtime, through more informed decision making and better visibility into support while saving the company enormous costs, protecting the assets and increasing the business sustainability
After identifying the diverse ways a company can manage its assets, it is essential for an organization to develop a process through it can be able to verify whether there are proper strategies in place to improve the operations of managing the company assets. The plan in place should be in a better position to identify all the assets that maintenance and develop strategies through which the assets will always be maintained. To improve the nature of the company assets, all assets should be revalued and repair and maintenance to be executed to enhance the machinery productivity per unit time to reduce downtime. However, all these falls on manager’s jurisdiction of performing proper and informed decision through the development of an appropriate plan.
Consider a situation where a bulldozer was supposed to excavate a particular area. The machinery has been in operation for three years, yet the tender owners require a machine that will not cause the hurdles. As the company owners, the motor is lent to carry out the work, but it fails even before it is quarterly done with the job. This means that the excavation will not go on or it will be delayed, and additional costs for repair and maintenance will be increased. It will lead to downtime, the decline in production power and may even lead to disruption of the business activities.
The loss in generation of power Poor asset maintenance leads to depreciation and failure in asset performance, and this intrinsically links to loss of generation power. Unavailability for the operation. It is natural that many activities are dependent on some assets which may be depending on each other. Poor asset maintenance leads to the development of problems in the assets, and this means that in the presence of a problematic asset, the impact may be more significant than anticipated. This leads to unavailability of the operations that in turn lead to higher costs and low returns.
Services disruption to customers: Any problem on an asset resulting from inadequate maintenance has an impact on some people. The more substantial portion affected by this is the customers who end up experiencing service downtime as a result of its unavailability. A higher the rate of service downtime leads to customer dissatisfaction and even loss of customers.
Unmaintained assets cause the organization to incur unexpected costs that may result in inefficiencies in operations and may lead to loss of business due to unwarranted costs from the poor asset management. The unplanned expenses always tend to overrun the planned expenses thus reporting negative variances.
The identified costs should be at all price be minimized to ensure the firm is in a better position to maximize revenue for the organization in the long. Additionally, unmaintained or poorly maintained assets poses a considerable risk to the employees and people who operate them to the point of death.
At times when the machinery is not operating, the company suffers from stock out costs due to lack of list and the same cannot be transported to the point of use of the raw materials. For example, if a tractor fails to function, it means that inventory and raw material will not be delivered to the point of us
Asset information systems help the firm make a decision based on the information generated, or they have regarding their assets. Therefore, it is essential for a firm to develop different strategies for ensuring that the firm remains within the budget no matter the costs. These will provide the company is always within the budget, and the operational costs will not overrun. Thus ensuring that profits are generated.
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