Research has shown the importance and impacts of Condition Based Risk Management and the results achieved underline the spicy question most CEOs and maintenance managers will have to digest.
In order to achieve success in the industry, CEOs and maintenance managers must discuss at the functional and operational levels the question that forms the baseline for delivering high asset reliability and availability indices through complete analysis of the following question: “CAN CONDITION-BASED RISK MANAGEMENT (CBRM) DELIVER THE DREAM TICKET TO RELIABLE ASSET OPERATION?” “Robert Davis” IEE Power Engineer Issue April/May 2005.
Modern asset management technologies and processes touch almost every aspect of corporate functions which include; operations, maintenance, and finance. Historically, assets managed referred to physical machines only but this culture and strategy have changed and pro-active and predictive asset management strategies are now being addressed at almost every level in the operational and functional context of organisations.
Asset as a broaden category is rolled up into buildings, plant, equipment, grounds, systems (IT, Finance) etc. The important drive is that selective initiation and development (when the first two phases of the systems development life cycle approach is examined) of an effective model into managing asset life cycle will have to be decomposed into a structured format with benefits that can be translated into millions of dollars in savings annually.
The first step into consideration for condition monitoring for asset management is “organisations’ rapid engagement” into the execution of a formal reliability-centered maintenance (RCM) study of existing assets linked with an extensive maintenance audit for deriving organisations’ maintenance functional indicators for existing assets within their operations.
Once the RCM study is completed, the next step is that management will engage in is the selection of a condition monitoring software solution that provides some necessary capabilities. Not only is fixed asset data capture important, but the condition monitoring software must gather and integrate data from the plant’s control systems and process cycles, perform analysis, and communicate vital information to other systems automatically.
The system will also offer an intuitive interface, such as a hierarchy tree (asset schema), that provides simple access to further levels of detailed asset information. Asset information may include a link to a physical location or piece of external system equipment, allowing the condition monitoring software and other external systems to share component information.
It is also important to note that the condition monitoring software is being able to support management and analysis of different types of data in order for the system to use plant wide data sources. The software chosen should accept numerous data types and allow user-defined units, further enabling system integration.
Many companies looking to maximize Return on Net Asset (RONA) are turning to integrated condition monitoring. As part of a comprehensive asset management program, condition monitoring helps gather the data needed by operators and maintenance personnel to keep critical equipment up and running efficiently.
It is too often taken for granted by CEOs and maintenance managers that running systems to failure will benefit organisations by presenting in their financial plan of their annual operating expenditure (OPEX) estimates, declining financial requirements to procure resources (materials & labour) for operations and maintenance. The impacts of incubating such “High Risks” will evidently induce gaps into the organisation’s operations strategy with compromised operations integrity so resulting in equipment and processes life cycle evaporation as the output reality.
Given that Risk = f (Probability of Failure X Consequence of Failure), it is vital to provide a realistic assessment of ‘consequence of failure’ for each asset. An extreme example is the Auckland incident of 1998, where the failure of a single 110 kv cable precipitated weeks of outages and economic losses of billions of dollars.
It is important to note that the development of “health indices” will allow corporations and utilities etc to effectively define their asset with acceptable calibrated results from existing data that they may have compiled. The concept strategy of sampling and effective analysis of data will give indications of asset condition and the health index will provide clear ranking of asset with respect to condition and proximity to asset end of life that can be translated into probability of failures.
The estimation with high accuracy of future failure rates can be determined with ongoing evident changes to the asset health index and with the probability of failures of asset; possibility of intervention by the maintenance organisation will truly position the organisation in line with the approach of understanding and managing risk. I do believe that CBRM will rapidly emerge as the next big thing in utilities and corporate management.
Those who adopt it early will reap the benefits and those who wait for it to be imposed upon them by regulation could find themselves embarking on a high risk strategy indeed. Also full acceptance of CBRM with effective implementation will change the method of data collection for analysis but it must however be noted that efficient qualification of asset condition during maintenance activities as well as inspection programmes will help utilities and corporations optimize their operational activities.
Effective CBRM will effectively define expenditures (capital and operating or recurrent) on asset as weighed against replacement and operations – the birth of “An Effective Capital Cost Deferral Strategy” will evolve as a result of increasing operations efficiency and effectiveness indices.
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