Strategic dimensions of maintenance management

If we put maintenance into a larger context, it is part of asset management. Asset management is basically about managing physical assets optimally over their life cy-cle in order meet the stated business objectives. The figure 2 clarifies the life cycy-cle perspective and the driving forces of asset management, in which maintenance is part of operations over the life cycle. (Komonen et al. 2012, p. 49-50) In this study, we are only interested in “operations and maintenance” part of the figure. That is, no preced-ing or followpreced-ing stages of the life cycle, such as installation or disposal of equipment, are of interest.

Operations and maintenance Installation and

commencing Manufacturing

Design of process and equipment

Concept design Disposal

 Changing demand

 Changing competitive environment

 Modified product

 Economic obsolescence

 Changing operational requirements

 Wear and aging

 Technical obsolescence

 Environmental obsolescence Use of investment Investment

Asset management of plants in operation: focus on upkeeping of plants’ productivity and profit making capability, and improving plants in changing business environment

Asset management of new installations: focus on the optimization of the life cycle profits of plants

Effects of changes in the environment at the corporate, plant, process and equipment level

Figure 2. Investment life cycle and driving forces of asset management. (Komonen et al. 2012, p. 50)

And to put maintenance management into a bit more focused context, it is directly linked to manufacturing management. The main objective of maintenance is to pre-serve the condition of manufacturing equipment through operational life cycle. Thus, maintenance strategy and manufacturing strategy have to be directly interrelated. This is not the case in many situations, as the importance of maintenance is not recog-nized. The strategic level of maintenance management is often ignored, and the focus is set only on tactical and operational aspects, such as how to maintain equipment in technical respect. This can actually lead to reduction in manufacturing performance.

And in turn – if maintenance and manufacturing are managed strategically, in paral-lel, and strategies and operations establish a coherent link between each other – this can lead to increased performance in manufacturing. (Robson 2010, p. 206-208)

Murthy et al. (2002, p. 291) have proposed the key elements for strategic mainte-nance management (SMM). These can be expressed in visual format (figure 3), also

including some additions based on the findings made by Robson (2010, p. 75). On the upper level, it is recognized that the business objectives are dependent not only on the internal objectives but also on the external environment. And the business objectives are the input to determining maintenance and manufacturing strategies. Maintenance strategies are for ensuring that the load requirements of equipment are met and that the equipment state is appropriate. Maintenance strategy determines how mainte-nance is conducted on the operational level, and implementation of strategy results in some performance (i.e. equipment state is restored or improved). The linkage be-tween maintenance and manufacturing is direct as manufacturing is dependent on equipment to be maintained. Manufacturing outputs serve the market, and the reac-tions from the market feedback to decision making.

Business objectives

Figure 3. Key elements for SMM. (Robson 2010, p. 75; Murthy et al. 2002, p. 291)

When taking a strategic approach to maintenance management, two key aspects need to be emphasized: (1) maintenance management is a core business function for over-all business survival and success, and therefore it should be managed strategicover-ally;

and (2) maintenance management needs to be based on quantitative models, which integrate maintenance decisions with other strategic decisions such as production planning. In SMM approach, maintenance is a multi-disciplinary activity, which in-volves:

 Understanding of degradation mechanisms of equipment and linking it with data collection and analysis, in order to assess the state of the equipment.

 Building quantitative models to predict the effects of different maintenance actions on degradation.

 Managing maintenance from strategic perspective. (Murthy et al. 2002, p.

290-291)

Pinjala et al. (2006, p. 216-220) have summarized maintenance strategy decision el-ements, which are presented in the table 3. A very similar classification has been made by Tsang (2002, p. 10-23, 26-35). He has defined the four strategic dimensions of maintenance management as (1) service-delivery options, (2) organizational design and structuring of maintenance work, (3) support systems, (4) and maintenance meth-odologies. Both of these classifications are essentially same.

The first four decisions are called structural decisions, as these decisions cannot be undone fast. For example, if maintenance has been outsourced, it is practically impos-sible to bring it back in-house immediately. The last six decisions are generally linked to specific operating aspects of a company, such as production process. Both the structural and infrastructural decisions are closely interrelated. They can have a major impact on the maintenance function’s ability to implement and support the overall business strategy. (Pinjala et al. 2006, p. 220)

Table 3. Maintenance strategy decision elements. (Adapted from Pinjala et al. 2006, p. 219; Tsang 2002, p. 10-23, 26-35)

STRUCTURAL DECISION ELE- MENTS

Maintenance capacity Capacity in terms of work force, supervisory and management staff.

Maintenance facilities Tools, equipment, spares, workforce specialization, location of workforce.

Maintenance technology Condition monitoring technology, expert systems, e-maintenance systems

Vertical integration In-house maintenance versus outsourcing, and rela-tionships with suppliers.

INFRASTRUCTURE DE- CISION ELEMENTS

Maintenance organization Organizational structure, responsibilities.

Maintenance policy and concepts Policies and concepts (see chapter 2.1.2, table 4).

Maintenance planning and control systems

Activity planning, scheduling, spare parts inventory control, costs. Computerized maintenance manage-ment systems (CMMS).

Human resources Recruitment policies, training and development of workforce and staff. Culture and management style.

Maintenance modifications Modifications in equipment, design improvements, new installations and new machine design support.

Maintenance performance meas-urement and reward systems

Performance recognition, reporting and reward sys-tems.