Rethinking Asset Lifecycle Management

Rethinking Asset Lifecycle Management

Andy ChathaPresident

ARC Advisory GroupAChatha@ARCweb.com

Technology

People

Information

Processes

2© ARC Advisory Group

Why Rethink Asset Lifecycle Management?Why Rethink Asset Lifecycle Management?

Bigger, More Complex Projects Riskier Business Opportunities Limited Capital, Tough Capital Markets More Mandatory Investments Global Projects, Global Project Teams Escalating Labor and Material Costs Poor Asset Utilization, High O&M Costs Lack of Skilled Workers Legacy IT Systems Constrain Improvement Easy IT solutions can help

3© ARC Advisory Group

A New Model for the Major ALM ProcessesALM Processes Have Specific Responsibilities A New Model for the Major ALM ProcessesALM Processes Have Specific Responsibilities

Project Performance Management (PPM)

Asset Performance Management (APM)

Project PerformanceManagement

(PPM)

Asset PerformanceManagement

(APM)

Asset & ProjectPortfolio

Management(APPM)

Handover

ModificationRequestsFunded

Projects

New Facility

Requests

4© ARC Advisory Group

ALM begins with a proper view of the AssetProductive Assets are More Than EquipmentALM begins with a proper view of the AssetProductive Assets are More Than Equipment

PrimaryFacilities

EquipmentRemote

Reference DataFunctional

DesignProcedural

Project-CentricProject MgmtEngr/DesignProcurementConstruction

SupportIT HW/SW

MobileMRO Material

Asset-CentricOperations

Process EngrMaintenance

Reliability

Activity RecordsCommercial

StatusHistory

The Three Asset Classes are Equally Important to Plant Success !

5© ARC Advisory Group

Collaborative Devices are EmergingCollaborative Devices are Emerging

Device Users, Technical Support, and Service Technicians Can Interact via the Device’s Collaboration Workspace

PM2009a1 pipeline mixer

Interactive Chat:- Respond to status request- Run diagnostics- Upload error logs- etc.

Planner

Service Engineer

Operator

Technical Support

Shift Supervisor

6© ARC Advisory Group

A New Model for the Major ALM ProcessesALM Processes Have Specific Responsibilities A New Model for the Major ALM ProcessesALM Processes Have Specific Responsibilities

Project PerformanceManagement

(PPM)

Asset PerformanceManagement

(APM)

Asset & ProjectPortfolio

Management(APPM)

Handover

ModificationRequestsFunded

Projects

New Facility

Requests

7© ARC Advisory Group

ALIM Improves ALM Performance Through Better Handover Processes and More Efficient Information Exchanges!

An ALM Information Management Strategy A Blend of ALM Process and Corporate StrategiesAn ALM Information Management Strategy A Blend of ALM Process and Corporate Strategies

ALMInformationManagement

(ALIM)

Project Information Management

(PIM)

Asset & Project Portfolio Info Management

(APPIM)

Asset Information Management

(AIM)

8© ARC Advisory Group

Performance ManagementBalancing Goals and Developing the Right Mix Performance ManagementBalancing Goals and Developing the Right Mix

Goals

Com

mitm

ents C

onstraints

9© ARC Advisory Group

ARC Level 1 Model for ALMThe Major Processes, Goals and Information MgmtARC Level 1 Model for ALMThe Major Processes, Goals and Information Mgmt

INFORMATION

PROCESSESP

EO

PLE

TEC

HN

OLO

GY

Handover

ModificationRequestsFunded

Projects

New Facility

Requests

BUDGET

ProjectPerformanceManagement

(Design & Build)

AssetPerformanceManagement

(Operate & Maintain)

ROA

BENEFI TS

Asset & Project

Portfolio Management

(Evaluate & Select)

10© ARC Advisory Group

A Structured Set of ALM ModelsStructure Supports More Realistic Process Models A Structured Set of ALM ModelsStructure Supports More Realistic Process Models

Level 1

Level 2

Level 3

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A Typical Level 2 Model for APMAPM for a Process Manufacturing Facility A Typical Level 2 Model for APMAPM for a Process Manufacturing Facility

O&M Service Providers

Shareholders Regulators

Construction Services

Fabricators

Equipment & Systems Suppliers

Project Management

MRO Material Suppliers

AI MPerformance

MaintainPerformance

OperatePerformance

ROA

12© ARC Advisory Group

A Typical Level 2 Model for PPMPPM for a Process Manufacturing Facility A Typical Level 2 Model for PPMPPM for a Process Manufacturing Facility

SCH

ED

ULE

SCH

ED

ULE Q

UALIT

Y

QU

ALIT

Y

BUDGETBUDGET

Fabricators

Equipment & Systems

Suppliers

Shareholders Regulators

Constructors

Project Management Services

Strategic Suppliers

Asset Management

Engineering

Services

Engineer Procure

Construct

ProjectI nformation

Mgmt

13© ARC Advisory Group

Asset & Project Portfolio ManagementAPPM Processes and StakeholdersAsset & Project Portfolio ManagementAPPM Processes and Stakeholders

RIS

KS

RIS

KS

RESO

URCES

RESO

URCES

BENEFITSBENEFITS

AllocateResources

EvaluateSolutions

IdentifyOpportunities

ManageInformation

14© ARC Advisory Group

A Level 3 APM Model People & Processes APM for a Process Manufacturing Facility A Level 3 APM Model People & Processes APM for a Process Manufacturing Facility

Safety & CMSystems

ProductionPlanning

Maintenance

Planning

Reliability Engr.

Proc/MfgEngr.

Plant & Project Engineering Support

Tacti

cal

Str

ate

gic

Au

tom

ati

c

Action FeedbackCoordination

Maint Staff

OperStaff

Parts Mgmt

MaterialsMgmt

OperateStrategy

MaintainStrategy

AP

MP

PM

Eq

uip

men

t C

han

ges

Operate Maintain

15© ARC Advisory Group

Safety & CMSystems

ProductionPlanning

Maintenance

Planning

Reliability Engr.

Proc/MfgEngr.

Plant Engr (M/E/Auto, EH&S)

Tacti

cal

Str

ate

gic

Au

tom

ati

c

Action FeedbackCoordination

Maint Staff

OperStaff

Parts Mgmt

MaterialsMgmt

OperateStrategy

MaintainStrategy

Automation Systems, LIMS,

Historians, Alarm Systems, Safety Systems, SMT

EAM/CMMS, Inspection,

Mobile Devices, RFID

ERP, CPM/MES,

Mobile Devices

RCM, Reliability Analysis &

Simulation, RBI

Process Models & Simulation

Plant Design, 3D Models, Laser

Scanning

EH&S, Sustainability,

HR

A Level 3 APM Model for Technology APM for a Process Manufacturing Facility A Level 3 APM Model for Technology APM for a Process Manufacturing Facility

16© ARC Advisory Group

Safety & CMSystems

ProductionPlanning

Maintenance

Planning

Reliability Engr.

Proc/MfgEngr.

Plant Engr (M/E/Auto, EH&S)

Tacti

cal

Str

ate

gic

Au

tom

ati

c

Action FeedbackCoordination

Maint Staff

OperStaff

Parts Mgmt

MaterialsMgmt

OperateStrategy

MaintainStrategy

Automation Systems, LIMS,

Historians, Alarm Systems, Safety Systems, SMT

EAM/CMMS, Inspection

ERP, CPM/MES

RCM, Reliability Analysis &

Simulation, RBI

Process Models & Simulation

Plant Design, 3D Models,

Project Mgmt

EH&S, Sustainability

AIM

A Level 3 APM Model for AIM APM for a Process Manufacturing Facility A Level 3 APM Model for AIM APM for a Process Manufacturing Facility

17© ARC Advisory Group

Reference Data Activity Records

A Level 3 APM Model for Information APM for a Process Manufacturing Facility A Level 3 APM Model for Information APM for a Process Manufacturing Facility

18© ARC Advisory Group

A Structured Set of ALM ModelsFramework Enables Cross-Industry BenchmarkingA Structured Set of ALM ModelsFramework Enables Cross-Industry Benchmarking

Production

Manufacturing

Energy

. . . . .

Process Discrete

T&D

19© ARC Advisory Group

A Typical Level 2 Model for APMAPM for Utility – Electrical T&D A Typical Level 2 Model for APMAPM for Utility – Electrical T&D

ROA

O&M Service Providers

Shareholders Regulators

Construction Services

Fabricators

Equipment & Systems Suppliers

Project Management

MRO Material Suppliers

Demand Mgmt

Outage Mgmt

AI M

CustMgmt

20© ARC Advisory Group

Key TakeawaysKey Takeaways

ARC has a long history of research around ALM We have developed various models to help clients

understand issues, develop strategies and select solutions

Our new ALM Model extends that research into more areas and more industries.

The structured nature of our new model:

• will enable ARC to provide you with more, valuable ALM research

• enable you to develop ALM strategies with more appropriate support for people, processes, technology and information needs analysis, and

• enable you to benchmark your ALM performance with peers and other industries and identify the Best Practices for your program

Thank You.Thank You.For more information, contact the author at

srsnitkin@arcweb.com or visit our web pages atwww.arcweb.com

22© ARC Advisory Group

ARC and Asset Lifecycle ManagementARC and Asset Lifecycle Management

Our Market Studies and End User reports cover all of the Key technologies, IT solutions and Best Practices in ALM

• PET, PSC, Laser Scanning

• PAM, Field Devices, Mobile Devices, SCADA, etc.

• EAM, FSM, MRO Materials Mgmt

• EIM, AIM, GIS We have developed an ALM community, a website

dedicated to ALM and publish a monthly ALM newsletter that is distributed to over 2500 ALM experts

We have also provided consulting services on ALM issues to many leading manufacturers