FAQ - Strategicorp

FAQ's

Who uses SOS™

Most of our users are large critical process, power generation/energy operations, steel, aluminum, nickel, mining, brewing, pharmaceutical, food, chemical, petro-chemical and more. All have a critical process and financial need to become more efficient.

How many SOS™ users are there ?

What is the underlying logic to THE SOS™ process ?

SOS™ was developed by and for maintenance engineers and materials procurement personnel. It incorporates a combination of industry accepted algorithms as well as SOS™ proprietary algorithms which are invoked based on the answers provided to a very specific set of technical and business related criticality questions. At the completion of an assessment, the criticality profile is utilized in conjunction with standard EOQ (Economic Order Quantity) calculations to recommend an appropriate max/min holding. At this point, further 'what if ?' exploration is encouraged, including examination of alternative usage estimates, lead times and repairability.

How will SOS™ Save me money ?

Please review the topics below to see ways that SOS™ has been used in real world applications:
Greenfield Sites
Greenfield sites or major extensions of an existing plant. The vendor(s) or prime contractor(s) recommend $7 million (pick any number) in spares. Consider the following:

You only budget for $4 million
The vendor(s) imply that to buy anything less or different could breach warranties and put your plant at risk!
How did they arrive at their figures?
Ask them ? You can probably guess ! ( they probably did ! ).
There are 5 variables that typically recur in every new/large extension site.
- Spares recommended are too high (cost to you)
- Some spares recommended are sometimes too low (risk to you)
- Some should not even be on the list at all (cost to you)
- While the list is missing others that should be included (risk to you)
- You can validate the correct levels (correct optimization)

So whether you use SOS™ for one day or one week or 6 months (up to and even past the project's completion date) you will save cash by not buying too many spares (and the carrying costs for many years). You will save cash by minimizing risks by not buying too few. You will satisfy the plant and general management that on day one you won't have to buy more spares that were not previously calculated for and also for others that may sit in your warehouse indefinitely.

Vendors cannot quibble or raise warranty issues when your SOS™ assessment is done in an operating context by your people for the new plant (it cannot be taken from a catalog).

Replenishment
Your CMMS or ERP system has just hit its minimum and is recommending you buy more up to your maximum (min/max). Consider the following:

Who set the min/max ? - The vendor ?
What was the rationale ?

A coin toss in conjunction with "gut" and some experience and maybe, (just maybe) some decent data.

The replenishment area provides a key opportunity to safely and cost effectively reduce spares / costs i.e. the initial cash outlay and the subsequent 5 years or more of carrying costs, (even off-site, pooled and other "chain" techniques still cost you) that effectively allows you to "own it twice and maybe use it never".

Using SOS™, even for a few hours, on contentious or expensive parts can demonstrate immediate and measurable savings.

Don't delay ! Every day millions of spares are being sold, bought and moved across borders to reduce inventory taxes. This is especially true in two of the largest industries, Power and Chemicals.

M & A - Mergers and Acquisitions
There are many derivatives of SOS™ usage. This is especially true of the volatile M&A activities of key process industries.

Example: You are a large utility and you have acquired or are considering the acquisition of a large power generating station, group of power stations or even a T&D (Transmission and Distribution) operation.

Using SOS™ you can now easily issue the edict "buy no more spares that have not been optimized by SOS™, or do buy spares that SOS™ recommends"

In the time it usually takes to identify and complete the targeted acquisition, tens of millions of dollars may have been wasted.
Because spares have continued to be purchased.
Because the synergy/commonality of your maintenance buying crews are not yet "aligned".
Of course some of this depends on circumstances:
- Is it a hostile takeover ?
- Are you in a position to issue such an edict ?

The SOS™ generated results can tell you or at least give a good indication of whether you may be paying too much, that the acquisition is still buying too much or carrying too much.

Even a cursory "run by" using SOS™ could pay for your entire M&A costs.

Using SOS™ also demonstrates to the newly acquired entities' personnel that the 'new owners' are not adopting a "slash and burn" philosophy but have a genuine desire to achieve consensus and teamwork.

Cyclical Events
Similarly to M&A, and business generally, competition and business cycles are always lurking nearby.
In particular industries every step is being taken (or should be) to reduce costs (without any additional risk to your business).
Even though maintenance often represents 15% of revenue (in process industries) versus 1½% for the high profile IT industry, it often gets the short end of the stick.
There are endless articles in the various trade press discussing how the "glamour" parts of business take precedent over the unfashionable maintenance operations.

Remember "Maintenance is a process NOT an event"

It is an all important process and an opportunity, rather than "a pain in the butt necessity" as it has been occasionally described in the press.

Some businesses have seriously reviewed maintenance and reliability and are taking limited steps to improve, while many merely pay lip service (or no "service") to this important part of any process operation.

The vast majority of senior management cannot tell you what the macro costs of maintenance are and therefore they are unaware what the sub-set costs are i.e. spares dollar value, spares holding costs, outage frequency, manpower costs, reliability expenditure or even who are the people directly in charge of these all important functions.

To be competitive business must not overlook any opportunity to be strong and reduce costs (without risks).
Using SOS™ you will safely chop millions from your operating budget.

Competition
Our major competition is inertia and hubris.

There really is nothing like SOS™.

So whether it is occasional or on a dedicated focused basis SOS™ will help you reduce costs safely.

Existing Inventory
Much of the typical 25-30% annual "carrying costs" of your process spares inventory involves physical movement, purchase, investment recovery, re-certification and transportation.

Beyond the obvious cost of money and lost opportunity costs and the many other on-going costs, it is clearly better to have never purchased (unnecessarily) the spares to begin with. It is also possible that your operating context has changed.

Risk Adverse
You may be running "dangerously" low of a spare. SOS™ will help here also.

Sometimes people know they are low, but play the dangerous juggling game of trying to satisfy the maintenance department, and the finance people simultaneously. Extended lost production is obviously the major risk.

But think again. It is not only about extended production delays (due to lack of spares) it is also dangerous for personnel as well.

i.e. Plants who do not have a spare are subject to the temptation to improvise, including using repaired (instead of new) spares, that may be flawed in some way or are inappropriate no matter how good the repair may be (i.e. a head gasket for your car's engine).

How do you summarize SOS™ ?

SOS™ will assist you to get the "correct" level of spares.
SOS™ will scientifically assist you to reduce spares on a net basis after validating existing levels, reducing some, increasing others.
Essentially
SOS™ asks " Do we need these spares and if so how many?"

I already have a computerized maintenance management system, doesn't it provide me with a maintenance planning module ?

No, all commercially available CMMS's require that you enter the details of your proposed maintenance schedules, from which they will carry out all the associated tasks of job card issuing, generation of history data, linking to other systems etc.

RCM Turbo™ is a modeling methodology for generating those initial maintenance plans, optimized and ready for export to the CMMS. It is also a full documentation system for your maintenance strategy development and a platform for continuous improvement and review.

Why do I need to consider the use of a maintenance planning methodology ?

In most large scale plant or process operations, maintenance strategies have evolved over time and very often, the original decision making process was not documented.

Even worse, maintenance strategies were based on business and economic conditions which no longer apply. Where reactive maintenance has slowly moved to preventative then predictive maintenance, there is often a mix of activities which are far from optimal. RCM Turbo provides an assessment environment within which to model alternative scenarios, to accurately examine both their effectiveness and technical effectiveness, while observing the principles of reliability centered maintenance.

WhaT ISSUES ARE DIRECTLY ADDRESSED USING RCM TURBO?

RCM Turbo is vitally concerned with the following important aspects of maintenance strategy development:

Do all of our assets perform at levels demanded by both our internal and external customers ?
Can we guarantee that we are spending the right amount on maintenance and in the right areas to achieve the required performance of the plant ?
Are we doing any unnecessary maintenance tasks, or are there some tasks which we should be doing but are not ?
Do we feel confident that we know the process by which our equipment fails ?
Are we sure that equipment failure in our operators will not cause dangerous accidents or environmental hazards ?
If we lose our experienced maintenance people tomorrow, will we still retain their experience ?
If we have a failure, are we confident that all relevant actions to recover and re-commission the plant are documented and easily found ?

Are some of our failures caused by the very activities which are supposed to prevent failure ( a common feature in predominantly 'fixed time' maintenance environments ) ?

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