Measuring overall craft effectiveness

by Ralph W. “Pete” Peters

What is overall craft effectiveness or OCE? It is very much like the concept behind the OEE Factor for the calculation of Overall Equipment Effectiveness. But OCE applies specifically to the productivity of craft labor resources. We will get to the practical concept and details of OCE later in Part II, but let’s first talk about contract maintenance providers. They clearly support my case for profit-centered maintenance and they clearly understand maintenance as a profitable business opportunity.

There are hundreds of large maintenance service providers such as the operation and maintenance subsidiaries within Turner Industries, Halliburton (Brown and Root), Fluor Corporation, ARAMARK ServiceMaster, etc. Then there are literally thousands of small providers down to that one person in a van with tools and work order/invoice forms that you and I typically call to fix things around the house we can’t accomplish.

Maintenance is forever and as a result there will forever be new business opportunities for the true value-added contract maintenance provider.

The future
All contract maintenance providers (large or small) clearly understand profit and the importance of overall craft effectiveness (OCE) and quality service. Very simply, their goal is to perform services equal to and with lower cost than in-house maintenance while making a profit and creating potential savings for you.

The future will see third party maintenance continue to replace in-house maintenance operations that have priced themselves out of the marketplace due to low craft labor productivity, poor service and technical skills, lack of internal leadership and of course declining physical asset reliability.

Got courage?
Who will step forward with the courage and the commitment necessary to bring the art and science of profit-centered maintenance into your operation?  

Will it be you or the vice president of ACE Technical Services Inc. who convinces your leadership that:
• “We have the technical know-how and the leadership capabilities to operate your maintenance operation and take it to another level, a more reliable and profitable level.” 
• “We will divest it completely from you and slowly sell its services back to you at a profit to us and a net savings to you, right now!
• We will validate immediate short-term benefits and continuously measure improvements and benefits to you over the long term. In fact, we will share savings with you via lowering of our rates for services. You may actually see a decrease in the need for our services in the future."
• “We will provide both the technical and personal leadership to avert certain failure of your business if you continue along your current path."
• “We will provide a measurable value-added maintenance service in the core business requirement that you have given up on.”
• “When can we sign the contract and begin to create improved cash flow, increased asset reliability and more profits for your company?”

Are you a takeover target?
The in-house maintenance operation that continues with rising craft labor costs and no productivity gains and marginal customer service will be an easy takeover target. Low craft labor productivity coupled with declining asset reliability, marginal safety and regulatory compliance is a big gamble. And we will never, never win when we gamble with maintenance costs over the long-term.

The Maintenance Excellence Institute continuously emphasizes through our maintenance seminars, speeches, articles and consulting work that “the overall maintenance process should be viewed and operated as an internal business and considered as a profit center."

We certainly believe that in-house maintenance operations can be competitive with the proper leadership, equipment, tools and application of today’s maintenance best practices.

The good, bad and really ugly
Personally, I am pulling for the home team; the internal maintenance operation, but only if there is still hope for them. I have seen the good, bad and the really ugly side of contract maintenance starting with really ugly providers of contract repair service to road building equipment in Vietnam in 1970-71.

More personal data comes from my experience doing very comprehensive, maintenance excellence assessments at more than 200 sites around the world. I have seen expensive contract maintenance being wasted due to poor planning, being underused and stifled because of poor in-house practices as basic as storeroom operations and lack of written PM/PdM procedures. A crafts person’s time and talents is a terrible thing to waste.

Likewise, as a manufacturing plant manager, I have seen good in-house maintenance operations and have personally experienced the benefits of increased capacity and reliable throughput. 

Now as a consultant, I have seen the good and bad examples and the really ugly ones where core competencies for accomplishing core requirements for maintenance were not present. Core requirements for maintenance of physical assets will never, never go away. Core competencies to perform in-house maintenance can vanish overnight.

Gambling with maintenance
Small operations with two or three craftspeople or less than 10 crafts are the most vulnerable. The loss of your only trained and certified instrumentation technician for example, is a serious loss of a core competency. 

So now as a consultant, I really do pull for in-house maintenance if there is still hope. But if there is no visible evidence that existing maintenance leaders have a chance or their top leaders continue “gambling with maintenance," I do not hesitate to recommend quality contract providers or increased privatization within a public sector operation.

Core requirements for maintenance do not go away
The following is taken directly from our Scoreboard for Maintenance Excellence comments summary and applies when the total score is below average: “Immediate attention may be needed to correct conditions having an adverse effect on life, health, safety and regulatory compliance. Place immediate priority and focus toward key issues, major production assets or facility conditions, building systems and other equipment where increasing costs and deferred maintenance are having a direct impact on the immediate survival of the business. The capabilities for critical assets to perform intended function are being severely limited by current 'state of maintenance.' Consider immediate contract services as required for business survival and for achieving the core requirements for maintenance services if necessary investments for internal maintenance improvements are not going to be made.” 

The core requirements for maintenance of each physical asset must come from somewhere even if leaders have given up on in-house maintenance.

Think like a business owner
On a more positive note, forget the past and think like a business owner. One of the great things about our minds is that they are ours. Yogi Berra may have already said this somewhere but really “our mind is like a canvas with our willpower being the brush."

As Dr. Robert Schuller said, “Your thoughts are the oils and colors. Within your mind is an incredible assortment of colors; every idea is a potential color!"

Begin to "see" ideas in "color."
• Ideas that are happy can be colored red, yellow.
• Depressing thoughts? Color them gray.
• Angry thoughts? Color them black.
• Loving thoughts? Color them blue.
• Forward moving, growth ideas? Color them green!”

The color of green
Think about this one important question and color it green for increased profit and service from maintenance.

“If I owned my maintenance operation, what can I do different to make a profit?

Secondly think about, “What will it take to regain or increase my core competencies, be competitive against contracted services, to keep more work in-house or avoid a complete take over?”

Today we can choose the attitudes for our own minds. We have all been given gifts of imagination and ideas - the personal thoughts within our own minds. We each have the creative power to draw the mental image and the positive attitudes within our own minds. You must see the finished project of your vision of maintenance excellence in your own mind first. And as Dr. Schuller also says, “If I cannot see it, I will never be it. Until I believe it, I will never achieve it!"

Introducing the OCE factor
The profit-centered maintenance leader (in-house or contractor) must consider total asset management in terms of improvement opportunities across all assets and resources. 

There many questions to be asked about how we can improve the contribution that each of these resources make toward your goal for maintenance excellence:
• Physical assets: equipment and facilities.
• People assets: craft labor and equipment operators.
• Technical skill assets: craft labor that is enhanced by effective training.
• Material assets: MRO parts and supplies.
• Information assets: useful reliability information, not a sea of useless data.
• Team processes: teams working as a true people asset multiplier.

One very key question must be: How can we get maximum value from craft labor resources and achieve higher craft productivity?” Maintenance operations that continue to operate in a reactive, run-to-failure, fire-fighting mode and disregard implementation of today’s best practices will continue to waste their most valuable asset and very costly resource - craft time. Typically, due to no fault of the craft work force, surveys and baseline measurements consistently show that only about 30 percent to 40 percent of an eight-hour day is devoted to actual, hands-on “wrench time”. Best practices such as effective maintenance planning/scheduling, preventive/predictive maintenance, more effective storerooms and parts support all contribute to proactive, planned maintenance and more productive, hands-on wrench time.  Measuring and improving OCE must be one of many components to continuous reliability improvement process and total asset management.  OCE includes three key elements very closely related to the three elements of the OEE Factor.

Overall equipment effectiveness (OEE)
We must clearly understand the elements of OCE and how the OCE Factor relates to better use of our craft work force. We all understand the world-class metric OEE - Overall Equipment Effectiveness that measures the combination of three elements for the physical asset; equipment asset availability, performance and quality output. 

An illustration of OEE:

Overall craft effectiveness (OCE)
The OCE Factor focuses upon craft labor productivity and measuring/improving the value-added contribution that people assets make. 

Just like OEE, there are three elements to the OCE Factor:
• the effectiveness factor;
• the efficiency factor;
• the quality factor.

However, only two elements of OCE can be as well defined as all three of the OEE Factors. We will now review the three key elements for measuring OCE and see how they very closely align with the three elements for determining the OEE Factor for equipment assets.

Calculating OCE

OCE focuses upon your craft labor resources
I strongly believe in basic maintenance best practices as the foundation for maintenance excellence. There must be what I call continuous reliability improvement (CRI). CRI is about maintenance business process improvement that includes opportunities across all maintenance resources: equipment and facility assets, people resources, our crafts work force and equipment operators. CRI must also include MRO materials management assets, maintenance informational assets and the added value resource of synergistic team-based processes. CRI improves the total maintenance operation and can start with measuring and improving OCE.

The Maintenance Excellence Institute advocates, supports and clearly understands the need for the reliability-centered maintenance (RCM) and total productive maintenance (TPM) types of improvement processes. But out on the shop floor we see today’s trend toward forgetting about the basics of “blocking and tackling” while going for the long touchdown pass with some new analysis paralysis scheme. RCM is not analysis paralysis when done correctly with true information and not based upon “precisely inaccurate” data.

Build upon the basics
Your approach must be built upon the basics and then include, but go well beyond the traditional RCM/TPM approaches to CRI.

Maintenance excellence 
can start with PRIDE in maintenance
Do not take a piecemeal approach that focuses only RCM-type processes on physical assets and equipment resources. Often, the maintenance information resource piece, among others, is a missing link for the successful RCM-type process. RCM alone can often become analysis paralysis with no data or bad data.

Your approach should be about improvement opportunities across all maintenance resources. There of course must be priorities as to where we start and where we make investments. For example, with the craft labor resource we can easily measure the three elements of OCE as we will see later in Part II. But we can start the journey to maintenance excellence by just helping to achieve PRIDE in Maintenance from within the crafts work force and among maintenance leaders at all levels.

What if we could get attitudes plus action from all our crafts focused on this question; “How would I do this job or lead this crew if it were in fact my own maintenance business?”

Ralph W. “Pete” Peters is president of the Maintenance Excellence Institute, 6809 Foxfire Place, Suite 100, Raleigh, N.C. 27615. He can be reached at 919-270-1173. For more information, visit www.Pride-in-Maintenance.com

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