Airplanes

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Airplanes!
PSU Industry Summit on Mining Performance Septembe
r 21, 2005
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Reliability-Centered Risk Management
Competitive Advantage In todays competitive
environments, maintenance organizations cant
afford not to implement a Reliability-Centered
Risk Management program. Maintenance is one of
the last frontiers in a companys battle to
improve bottom line profitability and gain a
competitive advantage in their respective market
segments.
Why Its Important To UsandHow It Benefits Our
Operations
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CNN Headline News!
Report Airliner crashes in western
Venezuela Tuesday, August 16, 2005 Posted 859
a.m. EDT (1259 GMT) CARACAS, Venezuela (AP) --
A passenger plane crashed in remote western
Venezuela with 152 passengers aboard early
Tuesday, an aviation official said. A top
government official said it was unlikely anyone
survived.
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CNN Headline News!
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Typical Maintenance Challenges
Cost of Ownership For a number of different
reasons and despite the big push for maintenance
organizations to become more proactive in their
approach to maintaining equipment, many still
find themselves in a reactive mode of operation.
Increasing reliability and reducing risk lowers
the total cost of equipment ownership and
increases plant capacity exactly what companies
need.
Keep production producing at thelowest cost of
equipment ownership
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Common Issues
Proactive Not Reactive Reactive maintenance
organizations claim they have little or no time
for implementing a Reliability-Centered Risk
Management program. While its true that an
implementation will require an upfront investment
of time, once the program is established, it will
actually free up time rather than continually
consume it.

• Frequent, repetitive problems
• No proactive problem resolution
• Unnecessary, untimely, conservative PMs
• No rationale behind PM actions
• Inadequate traceability of activities
• Sporadic risk assessment processes
• Acceptance of OEM recommendations
• Underutilized PdM technologies
• Narrow focus on only production

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Common Results
Complimentary Process Risk Management
compliments Reliability-Centered Maintenance by
helping classify the criticality of equipment
the most likely modes of failure the effects
these failures might have on equipment, the
environment, and personnel and what critical
spares will be required in the event of a failure.

• Reduced equipment availability capacity
• High equipment breakdown rates
• Decreased productivity
• High maintenance overtime labor costs
• High spares and work in process inventory
• Poor environment and safety practices
• Poor return on investment
• Poor quality
• Poor morale

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Food For Thought
No Time To Resolve For those who claim they
dont have the time to implement a
Reliability-Centered Risk Management program, I
ask them this question, "Why is it you can always
find time to fix the equipment, but never the
time to engineer out the problems and prevent
them from recurring?" For as many times as Ive
asked this question, Ive yet to hear a good
answer.
When people become very good at repairing we
should ask why they are getting so much
practice! Source Reliability Center Inc.
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Managing Risk Reliability
Managed Predictability The reality is equipment
performance is predictable, risk is manageable
and maintenance organizations can and should set
forth the necessary time and effort to do
something about it. It is the only way a
maintenance organization will ever break out of
its reactive maintenance environment.
Can risk and equipment unpredictability be
managed?
Yes They Can!
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What Is RCRM
Reliability Risk Although risk management has
always been a part of a Reliability-Centered
Maintenance program, few companies place as much
emphasis on managing risk as they do on managing
reliability. Just by it's name alone, people
understand that reliability and risk are
considered of equal importance in a
Reliability-Centered Risk Management (RCRM)
program.

• What is Reliability-Centered Risk Management?
• A combination of RCM and Risk Management best
  practices in a single, cohesive program

• What are the advantages?
• Reduced potential risk of failure
• Lower total cost of equipment ownership
• Increased equipment availability
• Equal focus on Production, Environment and Worker
  Health Safety
• Unleashes additional capacity (volume)

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Risk Impacts Bottom Line Profitability
Risk Inventory Levels Companies should pay
attention to how much work in process is sitting
around on the shop floor or how many spare parts
there are in the maintenance warehouse. One of
the main reasons for a company keeping excess
work in process and/or an abundance of spare
parts inventory is to protect itself against the
risk of lost production from an equipment failure.

• To accommodate risk, we substantially increase
  spare parts and work in process inventories to
  compensate for exposure to the risk of lost
  production and perceived unpredictability of
  equipment performance.

Whats the value of our spare parts work in
process inventory?
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Risk Management
Balancing Risk If we can identify, manage and
contain risks, we can substantially reduce the
levels of spare parts and work in process
inventory. As inventory costs money, the net
effect is like putting money back into the
companys bank account. The trick, however, is
balancing the likelihood of equipment failure
against the liability of plant operation and
ownership.

• Risk Management is
• A process of well-defined steps which, when taken
  in sequence, supports better decisions by
  contributing to a greater insight into risks and
  their impacts

• In Mining Terms
• To balance the likelihood of equipment failure
  against the liability of facility operation and
  ownership

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Risk Categories and Effects
All Encompassing Usually when we think of risk
in a production facility we think in terms of,
If something happens to the equipment, how will
it impact production? Reliability-Centered Risk
Management takes this a step further by asking,
If something happens to the equipment, how will
it impact production, the environment and/or
worker health and safety?

• Production
• Availability of Equipment
• Quality of Product
• Quantity of Product

• Environment
• Contamination of Air, Water, Ground, WIP

• Worker Health Safety
• Injury
• Death
• Morale

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Risk Considerations

• If it fails
• Will it impact production
• Will it create an environmental incident
• Will it create a worker health and safety concern
• Is it covered by MSHA, EPA or other mandated
  codes
• Does it have a high replacement cost
• Can it quickly and easily be replaced
• Is it a long lead-time item

Focus On High-Risks Completed risk assessments
should be sorted in order of priority for
execution, based on Criticality, Category,
Overall Impact and Likelihood of the failure
occurring. Equipment impacting production, the
environment and worker health and safety, with a
high overall impact and high likelihood of
failure, it would obviously take priority.
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RCM Components
RCM Strategy and Goal Reliability-Centered
Maintenance is a process to determine the most
appropriate maintenance strategies for a piece of
equipment in order to improve its reliability and
life expectancy while minimizing the potential
for undesirable impact on production, the
environment and worker health and safety in the
most cost effective manner possible.

• Preventive Maintenance
• Maintenance and Operations
• Predictive Maintenance
• Proactive Maintenance
• Information reviews
• Reliability engineering
• Benchmarking
• Continuous improvement
• Redesign
• Run-to-Failure

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RCM Decision Logic Tree
RCM Logic Tree The RCM Decision Logic Tree is an
excellent tool to help evaluate the right
maintenance strategies for a piece of equipment.
It is especially helpful to those new to
Reliability-Centered Risk Management concepts.
However, it should be used only as a guideline as
there will sometimes be circumstances that will
require a different strategy than that suggested.
Source Cadick Corp.
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Risk Assessments and Action Plan
High-Risk Equipment To understand and manage
risk associated with a business, you must first
identify all of the potential exposures to risk
and the consequences of a failure. Although this
may seem like a daunting task, the key to keeping
the process simple is to first identify and
eliminate the equipment from the list that will
not require any action,

• Keep process simple
• Eliminate equipment requiring no action no risk
  to production, environment, workers
• Catalog equipment by criticality, risk impact
  severity
• Perform risk assessment of critical equipment
• Develop maintenance strategies, routines and
  schedules based on above
• Formulate spares WIP inventory strategy

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How To Basic Risk Assessment
RCRM Dynamic Process After completing the risk
assessment and reviewing its findings, it should
be easy to see which pieces of equipment will
require some follow up action. In most cases this
action may be in the form of a redesign or
modification to eliminate or reduce the potential
for an identified risk. Risk assessments are not
a one-time-thing, but a continuous process as
equipment changes.
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Risk Assessment Scoring System
Risk Awareness When modifying equipment, revise
the risk assessment form to reflect the new level
of risk based on the change. Because maintenance
and operations personnel will use these forms as
an educational tool to assess their exposures to
risk when working on or around the equipment,
these forms should always reflect the current
level of risk.
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Risk Assessment Scoring System
Assigning Risk Values In order to evaluate risk,
a numbering system should be used and assigned to
the three categories affected by a failure, the
overall impact of a failure and the likelihood of
the failure happening. Companies should always
strive to maintain equal focus on production, the
environment and worker health and safety.
Category Production...... 1 point Environment....
. 1 point Safety Health. 1 point Impact
Likelihood High............ 3 points
each Medium.......... 2 points
each Low............. 1 point each
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Addition Versus Zoned Scoring
Additive or Zoned Risk A zoned risk assessment
scoring system better reflects the true exposure
to risk versus an additive scoring system. Once a
person becomes familiar with the zoned scoring
system, they can easily distinguish a high-risk
piece of equipment from a low risk piece. This
quickly provides focus on the equipment that
poses the most risk requiring the most immediate
attention.
Additive 14
Additive doesnt represent true risk
Zoned Category/Impact/Likelihood
Zoned Risk 3.2.3-4-2 (Maximum 3.3.15-0-0)
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Cliffs RCRM Example (FMEA Lite)
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Six Sigma FMEA Form
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Information Reviews
Equipment Reviews A good, proactive practice is
to continually review equipment information to
look for performance related trends that could
indicate equipment deficiencies. Informational
reviews can supplement the findings of a
Predictive Maintenance program or even prompt the
need for further investigation based on
observations. A CMMS will often contain the most
valuable information.

• Use right data to determine maintenance
  requirements
• Risk assessments
• Maintenance PM results
• Operator PM results
• Maintenance repair history
• PdM findings
• Historical spares parts usage
• OEM information with caution
• CMMS excellent source

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The End!