How to Get Optimal Enterprise Physical Asset Utilization and Asset Performance

Getting Excellent Enterprise Physical Asset Utilization and Maximum Asset Performance Needs Business-Wide and Life-Cycle-Long Coordination and Cooperation

By coordinating and merging business-wide data and asset historical performance records into useful asset information, you can make timely and informed decisions that safely and profitably maximise the performance and value contribution of your enterprise physical assets

To go down the path of getting operating asset optimization it is necessary that you first identify what measures will be used to determine the “optimal asset utilization” state.

Equally important is to identify in specific detail where losses are taking place in the operation because of poor asset utilization and what it costs the operation not to take action on those losses



Figure 1 shows the information paths needed to establish optimised asset utilization. By coordinating and merging this data into comprehensive asset information you can achieve the goal to make timely and informed decisions to safely and profitably maximise the value of your enterprise physical assets.

Inputs for Optimal Physical Asset Utilization

To go down the path of getting operating asset optimization it is necessary that you first identify what measures will be used to determine an “optimised asset utilization” state. Input into the choice of measures must be had from engineering, operations, reliability, maintenance, safety regulatory, procurement, and risk.

Some organisations may justify the development of teams that take these inputs to develop criteria for performance and costs in conjunction with corporate business objectives. Inevitably these indicators must be in the form of financial benchmarks for the use of senior executives. These criteria must take into account the life time financial impact that any asset used has on installation, development, production, quality, safety, hazardous waste disposal, maintenance, purchasing, and final disposal.

However, it is equally important that the asset optimization model identify in quite specific detail where losses are taking place and what it costs the operation not to take action on those losses. Appropriate measures, or performance indicators, must be used that serve the practical purposes of production and maintenance.

Because business requirements may change daily in response to outside factors there needs to be a continuous refinement of the optimized asset profiles.

Reliability Analysis and Planning

Initially involves determining and communicating the performance indicators for tracking improvements, such as production downtime, reducing maintenance overtime costs, reducing costs of spares.

The next step involves a study of the criticality of all the production assets related to their impact on future production requirements, safety, regulatory compliance, spare parts costs, unplanned failure costs etc. A structured approach such as the Plant Wellness Way RGCA (Reliability Growth Cause Analysis) can facilitate this study. An example RGCA as a PDF document can be downloaded from Reliability Growth Cause Analysis (RGCA) Tutorial.

The output of this study must be a site appropriate maintenance plan specifying an optimised balance of CBM, PPM, Precision Maintenance and Breakdown Maintenance. This shapes reliability driven maintenance execution and reliability feedback activities.

Also involved is the regular review of failures and near-misses with RCFA to determine the causes. Modifications are then made to the reliability plan to prevent recurrences.

Condition Monitoring and Analysis

Most machine and process characteristics which affect quality, availability, capacity, safety, risk and cost can be continually evaluated throughout an asset’s lifetime. This is essential in identifying impending failure and will be applied to critical areas identified in the reliability plan.

The current “state of health” of process plant is important information, as it’s related to current performance information, diagnosis and prognosis of various defects, and predicted useful life in the optimisation of safety, quality and high production rates.

Because of the sophisticated technology employed and its complex data, operators require clear and plain language information and forecasts.

Maintenance Implementation

The output from the Reliability plan is used (in conjunction with a CMMS) to create a system for its implementation. Inputs required for asset optimisation include maintenance resource availability, asset and problem histories, and work order planning, scheduling, tracking.

This will be significantly influenced by inputs from condition monitoring.

Maintenance can do no more than ensure that plant will perform to its built in (or inherent) reliability. If plant is not capable of delivering the desired performance to begin with, maintenance alone cannot enable it to do so. The plant (or components) must either be modified or production’s expectations lowered.

Process Control & Management

There are the obvious functions of monitoring and controlling the process for reasons of safety and product specification. Additionally, there is invaluable information to be gained from the process parameters that can give an understanding of the current health of the asset.

A further important output of this is the understanding of bottlenecks or backlogs within the current production stream which can assist in optimisation of the assets involved.

As process control systems become increasingly complex there comes an increased probability that they will cause production losses. Additional support resources may become necessary.

Operations Planning

Takes into account the whole process input supply chain – fuel, power, steam, water, raw materials, and requires to know the current, planned and historical production and efficiency levels in a process line, and be able to modify this level.

Safety and Regulatory Compliance

In more recent times the increasing demands of these compliances has had one of the more major impacts upon optimizing asset utilization in the manufacturing industries, particularly with the movement toward self-management of these functions within companies due to the limited resources available to regulatory bodies.

Note that these changes can also introduce new freedoms in implementing improved technologies, which not only satisfy compliance with the regulations, but can contribute toward improved plant integrity and availability.

For example, the Australian/ New Zealand Standard for In-service Inspection of Pressure Equipment (i.e. AS/NZS 3788) is to some extent prescriptive in defining internal and external inspection intervals. However, there is flexibility within the standard to apply a Risk Based Maintenance approach to extend these intervals by using external non-destructive testing techniques to replace internal inspection, where it can be demonstrated that there is no increased safety risk.

Environment and Sustainability Compliance

A thorough understanding and costing of the lifetime impacts of industry on a region is a necessary requirement in order to prove that its presence will not harm the long term well being of the locality, both below the ground and on the ground, nor harm its flora and fauna species.

The co-habitation of industry with its community is addressed by standards such as ISO 26000 – Guidance on social responsibility.

Plant Design and Development

In the management of asset optimization it is essential to understand the design specifications for the plant and the component parts. This enables proper process and component risk assessments so that the likely failure modes and their effects are understood. This will, in turn, provide a guide to the appropriate use of condition and performance based techniques and the application of non-destructive testing. In the event of equipment failure or failure to meet production specifications the design specifications must be reviewed to enable Physics of Failure Analysis so that redesign or replacement will satisfy all operational life requirements.

Again, if operational service requirements are changed the plant and component specifications must be clearly understood to ensure compatibility of the changes.

MRO Procurement, Stores and Financial

The balance in holdings of spare parts and spare replacement assets is critical; too little parts inventory may lead to increased production downtime; too much parts inventory requires storage facilities and ties up capital.

The use of preferred vendors can lead to cost savings, reliable just-in-time deliveries, avoidance of panic buying. Interaction with other departments, particularly maintenance, is essential in finding this balance, or optimisation.

Equipment Performance Audit

  1. Identify Assets List and clearly identify all assets and associated power supplies, control and existing surveillance systems.
  2. Identify Equipment Function Identify the following information
  3. What is the equipment required to do? What are the operating conditions?
  4. Code Equipment: Set out a clearly defined coding procedure for all assets.

Reliability Audit

  1. Reliability Block Diagram: Produce a simple high level reliability block diagram including whether equipment has a series or parallel reliability effect. The use of reliability and availability factors is recommended to improve the targeting of the condition monitoring processes. Detailed information on producing reliability block diagrams is contained in BS EN 61078 – reliability block diagrams.
  2. Physics of Failure Analysis (POFA): Carry out Physics of Failure Analysis to identify the causes of likely future faults, symptoms and potential parameters to be measured which indicate the presence or occurrence of faults. Detailed information on carrying out a POFA is contained in a the PDF document Physics of Failure Analysis (POFA) Asset Maintenance Strategy Tutorial. Fault diagnosis procedures shall be in accordance with ISO/CD 13379 – condition monitoring process. Guidance on the selection of performance parameters useful to indicate faults for a range of machine types is contained in ISO/CD 13380 – machinery condition monitoring.
  3. Identify Asset Criticality: Carry out an Equipment Criticality Analysis to identify the relative criticality to the operation of the equipment being used. This may be a simple rating system which includes a method of weighing factors including: failure rates, replacement cost, safety and environmental considerations and the results of failure occurring (secondary damage). More detailed methods of carrying out a risk assessment are contained in ISO 31010 – risk management – risk assessment techniques.

Asset Utilization and Performance Parameters to be Measured

The POFA and Criticality review will produce information on the range of parameters to be measured for particular failure scenarios. Parameters to be considered are generally those which will precede a fault condition either by an increase or decrease in overall measured value, or by some other change to a characteristic value such as pump or compressor curves, reciprocating internal combustion engine pressure – volume curves and other operating efficiency curves. Guidance on the selection of performance parameters useful to indicate faults for a range of machine types is contained in ISO/CD 13380.

Optimal asset utilization and asset performance requires planning and strategizing as to what must be done in a range of business processes. It also requires that preparations to collect information using effective practices be made and imbedded throughout the asset life cycle. By taking this holistic asset optimization approach, you can design and build an enterprise asset management system that brings you world class production performance for the least maintenance costs.

All the best to you,

Peter Brown and Mike Sondalini
Lifetime Reliability Solutions HQ