Jul-2009

Improving asset performance and 
process safety

How to achieve effective risk management and excellence in plant reliability and safety through asset performance management

Roy E Whitt
Meridium

Article Summary

In today’s turbulent economic 
times, asset-intensive manufacturing businesses are under heightened pressure to achieve profit levels that will satisfy their primary stakeholders, while maintaining safety performance that is more than just acceptable. Accomplishing this objective requires a thorough, sustainable business plan — not just for the company, but for its valuable physical assets as well. Asset-intensive businesses can attain significant improvements in reliability and safety by providing employees with meaningful and attainable goals that benefit them and the business; with effective tools to accomplish these goals; and, finally, with capable practitioners placed in strategic roles to provide leadership and guidance.

Lack of work processes
The oil refining industry has historically faced the challenges related to extracting optimal performance from a large installed base of assets while maintaining and improving safety performance. Risk was acknowledged but not managed. Change seemed unachievable within a culture where strongly ingrained behaviours favoured production output. Refiners knew that improvements in planning, scheduling and executing maintenance were needed but lacked the work processes and systems to achieve them. In particular, the volume of problems represented by large numbers of assets, such as pumps, valves, vessels, piping and instruments, overwhelmed the paper-based systems in place to manage them. Plant challenges exceeded the capability of technology to address them. Eventually, techniques and technologies evolved and grew to the point that as the new century dawned, effective planning and scheduling systems, quality and reliability prac-tices, risk-based techniques, invest-ments in computerised maintenance management systems (CMMS) and project management systems all became the norm in multiple industry sectors. Unprecedented productivity, reliability and safety performance resulted. Now, new and potentially even greater opportunities exist in the “management” of equipment strategies generated from the information collected by these earlier techniques and technologies. In short, technology has now outpaced industry’s ability to implement known solutions.

While there has been tremendous improvement in reliability and safety performance in many refineries in the last decade (Figure 1), refiners have much more opportunity to increase capacity and safety performance. Doing so will require visionary leadership, implementation of best practices enabled by technology solutions and capable people in key roles.

Establishing meaningful goals
Refining margins are characteristically cyclical, as demand ebbs and flows with petroleum availability and price. Thus, costs are always a prime concern and major emphasis for managing a business during times of thin margins. But, companies often focus on that which is easily controlled — operating costs — and lose sight of what might be more important — a proper focus on those things that will make the business successful in the long run. Executive leadership must focus the refining organisation on a few critical business drivers — typically, production, cost 
and risk. The objectives must be articulated in a manner that allows employees to develop actionable 
steps to support the stated business objectives. While the issues are complex and many, the approach needs to be simple and concise. During tough economic times, cost reduction is a necessary reality but must be accomplished with knowledge of the impact on risk to production and safety. In a commodity business, lower costs accompanied by even lower production, resulting in higher unit cost, will lead to fewer sales. The focus of this article is on a well-articulated business plan to increase profitability and safety, while managing risk through a laser-focused asset performance management initiative.

It is then incumbent upon natural leaders throughout the organisation to identify practices and systems that can 
be employed to accomplish the 
objectives set out by management to achieve this improvement in reliability. These leaders will be in middle management, members of functional teams, operators and craftsmen or working as some other key resource. These are the people who recognise the wisdom and importance of implementing work processes and best practices to create benefits that accrue toward satisfying the business drivers outlined by executives. They will naturally understand how to translate clearly articulated macro goals into actionable tasks and intuitively know which tools or systems to use to get things done in the field.

Executives must take care to not de-emphasise asset performance in their zeal to control or reduce costs. Issues should be framed by describing a goal of using the latest technology to enable improved productivity while reducing costs and managing risk. This goal is and should be conveyed as a win-win for the company and its employees - everyone working toward a common goal of improving reliability and safety while managing risks and watching profitability increase.

Employment of reliability improving work processes
No-one will argue the need to reduce costs when demand declines and cash flow is a problem, but simply cutting costs is not a sustainable business plan. While it is an answer to an immediate objective, a more prudent business approach is to identify the smart costs to cut, or even where to shift spending in order to achieve more from the investments that are being made; and to do so not simply during a crisis, but continuously and consistently. So, how can you most effectively cut costs without increasing equipment risk and compromising safety? The answer is complex and has many facets. Total operating costs include expenditures in many areas and each needs to be reviewed for effectiveness and efficiency. Proper investment in equipment design and operation is critical to good business results, but will not be covered in this analysis. At the end of the day, there are basically only two ways to reduce costs: do the work more efficiently and do less work.

However, an important area of plant expenditures, and one which generally receives lots of scrutiny during times of forced cost reductions, is total maintenance cost, which should be optimised while managing risk and ensuring reliability. In fact, it is even more important to invest in this optimisation activity with risk 
awareness in a cost-cutting environ-ment. When accomplished within the boundaries of a well-conceived asset performance management plan, the likely result is better reliability, 
enhanced process safety and an improved asset risk profile.