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September 08, 2003

Criticality analysis
Use it to optimize your plant's four key drivers--product quality, production volume, safety and finished
goods inventory
By David Berger, Contributing Editor
May 29, 2001

Criticality analysis
Use it to optimize your plant's four key
drivers—product quality, production
volume, safety and finished goods
inventory
By David Berger, Contributing Editor
In my article "Bridging the gap," April 2001, I discussed the evolving relationship among operations, engineering and
maintenance, especially as it relates to plant-floor automation. It's clear from Plant Service's exclusive research that there
is a shift under way from individual departments engaged in constant fire-fighting to a more matrixed and team-oriented
organization intent on planning. As companies make this adjustment, they must take into consideration the shared goals
and objectives of operations, engineering and maintenance. This translates into key drivers and measures that can be
used to define success on the shop floor.

In the research, several questions asked about the type, frequency and relative importance of shop floor data being
collected. Respondents from both maintenance and operations identified the top four drivers as: product quality,
production volume, safety and finished goods inventory.
Most tracked these on a daily basis, although almost a third of respondents said they tracked the drivers on a real-time
basis. Close to two-thirds said they expected that three years from now, critical drivers would be available in real time.

Now that there's a greater consensus across the plant as to what information is important to capture and manage, the next
step is to examine what measures affect the four key drivers identified in the survey.

For starters, operations can use a human machine interface (HMI) system and maintenance can use a CMMS integrated
with the HMI to track key measures identified by criticality analysis.

The criticality analysis process

Criticality analysis is a technique for examining your asset base in detail to determine potential failure points,
bottlenecks and areas of weakness. It also identifies methods to increase asset availability, reliability and operability, as
well as decrease the quantity and severity of suboptimal asset performance. Examples of suboptimal asset performance
include decreased production volume, poor quality output or loss of finished goods.

Conventional wisdom suggests that it's the role of maintenance to conduct a criticality analysis. However, our research
suggests strongly that operations, engineering and maintenance would be better served by jointly conducting the
analysis.

Criticality analysis can be used to examine each component of each piece of equipment to determine its relative
importance in optimizing the key drivers. Start with the most critical equipment, which is defined as the equipment
having the greatest impact on downtime or suboptimal performance. For each component, answer these questions:

1. What does this component do? In some cases, this is an easy question to answer. For example, engine oil reduces
friction between moving surfaces, thereby reducing power loss. However, determining its other functions may require
input from engineering, equipment vendors, equipment manuals and historical records.

2. What happens if it fails? This is a key question. Embedded in it are the links among the four key drivers (e.g.,
production volume, product quality, safety and finished goods inventory) and the three key measures that have been the
domain of maintenance historically (e.g., equipment availability, reliability and operability).

There are four responses to this question.

Total shutdown. This can result in significant losses of production volume, labor hours, raw materials, spare parts and
so on.

Reduced efficiency. This can be thought of as a "brown-out" as opposed to the "black-out" of a total shutdown. For
example, reduced production rates.

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Financial loss. While the component failure may not effect production volumes, it may reduce the overall asset life
(e.g., faster wear rate) or lead to other problems, such as quality or safety.
Negligible impact. If there's no major impact anticipated by component failure (for example, one of two redundant
support straps breaks), then typically the component will be allowed to run to failure.

3. What maintenance program is optimal for this component from a cost/benefit perspective? By comparing the
cost of component failure in question 2 with the cost of the following options, you can determine the optimal
maintenance program: reactive, preventive or predictive.

4. What measures need tracking to ensure success of the maintenance program? By definition, a successful
maintenance program must be time-based and stated in both qualitative and quantitative terms. These measures should
be linked to the goals and objectives of maintenance and operations.

5. How should these measures be tracked and analyzed? While manual systems for tracking and analyzing data can
be error-prone and take too long to prepare, they are better than nothing. Properly integrated, enterprise-wide CMMS,
HMI, enterprise resource planning and other plant automation systems can deliver huge savings by collecting accurate
data from the shop-floor on a timely basis and providing comprehensive analysis tools, such as root cause analysis,
Pareto analysis and simulation.

6. Who is responsible for data collection, analysis, decision-making and taking action? Diffusion of responsibility is
not uncommon, even when sophisticated data collection and analysis tools are deployed. Ultimately, someone must take
ownership for a problem and its resolution. In a matrix organization especially, the roles and responsibilities of
operations, engineering and maintenance must be clearly defined.

By definition, a successful maintenance program must be time-based and stated in both qualitative and quantitative
terms.

David Berger is Managing Director of Grant Thornton Management Consulting in Toronto, Ontario. He is a certified
Management Consultant and a registered Professional Engineer. He is Founding President of the Plant Engineering &
Maintenance Association of Canada, past President of the Toronto Chapter of the Canadian Society for Industrial
Engineering, and a past Vice President of the Institute of Industrial Engineers. He can be reached at
mailto:dberger@GrantThornton.ca.

Plant Services © 2001 Putman Media

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