Asset optimisation in industrial manufacturing

1. Real-time data

In today’s rapidly evolving manufacturing landscape, data plays a crucial role in driving operational efficiency through informed decision-making. To make the most of available data, manufacturing organisations must develop a robust strategy that identifies relevant information for performance evaluation. They must also collect data across various functions such as sales, finance, supply chain, manufacturing, and maintenance. This comprehensive approach establishes a clear connection between overall business performance and organisational objectives and ensures any decision made is with the overall strategy in view as a guiding principle.

At the asset level, leveraging sensors, monitoring equipment, actuators, programable logic controllers (PLCs) and other devices allows for real-time data collection. This data provides valuable insights into asset performance, product output, maintenance needs, and potential bottlenecks. What’s more, by monitoring asset health data integrated into a maintenance system, manufacturers can shift from reactive to proactive maintenance, minimising downtime and optimising production processes.

Integrating this data from the core manufacturing equipment into Internet of Things (IoT), enterprise resource planning (ERP) and finance systems involves establishing secure and reliable data pipelines that facilitate seamless communication between these components. Real-time asset data can be used to improve inventory management, key performance indicator reporting, optimise supply chain logistics and streamline production scheduling. This level of integration empowers manufacturers to make data-driven decisions with the holistic visibility of all aspects of their organisation.

However, mere accumulation of vast amounts of data does not guarantee meaningful insights. The key lies in transforming data into actionable intelligence that can drive decision-making at all levels of the manufacturing organisation. Effective data utilisation relies on tailoring data visualisation to meet the specific needs of different organisational levels. Customised real-time dashboards and reports should be created to empower operators, supervisors, managers, and executives to derive meaningful and actionable insights in line with the overall organisational strategy.

2. Asset management strategy

Assets are at the heart of manufacturing operations, including manufacturing lines, receipt and disposition warehousing, and the supporting spare parts or consumables to ensure continued operations.

In Australia, ageing assets are a dominant challenge that many organisations deal with; and achieving sustained value from the existing asset base is a key to operational efficiency. However, before optimising ageing assets, organisations should consider linking their asset strategy to the overall business strategy. This can be done through lifecycle planning: Is the cost of operating and maintaining the ageing asset greater than the requirement for capital replacement?

Through this lifecycle view, the operational objectives such as minimal downtime, reduction in product spoilage, and improved overall equipment effectiveness (OEE) can be embedded using reliability engineering principles. This starts from user requirements specification (URS) during capital planning through to qualification activities, operational readiness, and ongoing maintenance management of the manufacturing equipment. The outcome being reliability, availability, and maintainability.

In optimising operations, end-of-life for the assets is then considered based on the following triggers:

• obsolescence of equipment that is no longer supported by the original equipment manufacturer (OEM), so spare parts are not readily available for maintenance needs
• performance and availability of the equipment no longer meet operational objectives, with excessive failures leading to a regime of corrective maintenance as opposed to planned and preventive maintenance
• functional requirements no longer meet the business objectives such as the demand profile and volume, or the product mix
• technology advances such as introduction of IoT devices and automation, making modernisation of existing equipment no longer viable
• regulatory changes that may introduce more stringent safety, quality or risk compliance requirements the existing equipment is incapable of meeting.

3. Automation

Industry 4.0 technologies and automation, have emerged as powerful tools for driving asset optimisation. By leveraging these tools, manufacturers can enjoy multiple upsides, including better performance reporting, predictive maintenance, improved safety, enhanced repeatability/precision, higher product quality, cost savings and competitiveness.

These solutions are quickly becoming the norm for new manufacturing sites because they can enable the implementation of advanced technologies right from the start. This ensures asset optimisation is ingrained into the foundation of operations, setting the stage for long-term success.

For existing assets, incorporating automation can be achieved by folding them into current operations through exercises like As Is/To Be process mapping. By identifying areas for improvement and deploying digital tools and automation strategically, manufacturers can drive overall operational efficiency improvements while integrating into the thinly stretched workforce to dramatically increase their presence, productivity and impact.

This shift toward efficient and automated operations will help:

• reduce downtime
• maximise production
• enable cost savings
• help deliver profitable outcomes, particularly within the context of Australia’s increasing manufacturing operations and maintenance costs
• enhance safety protocols, ensuring a secure and productive working environment
• foster repeatability and precision, leading to improved quality control and customer satisfaction.

To effectively harness the potential of digital transformation and automation, manufacturers should develop a comprehensive strategy that encompasses process optimisation, technology adoption, and skill development. By investing in the necessary infrastructure and providing training and upskilling opportunities to employees, organisations can empower their workforce to adapt to these transformative changes.

4. Optimising productivity

Rather than focusing on jobs and labour costs, leaders need to focus on productivity and efficiency. This includes challenging the labour-based model of asset use on a 5/3 or 6/2 shift basis, to an optimised model that operates 24/7 with high levels of automation. In this model, without traditional downtime for maintenance activity, leaders will need to think differently about asset availability and reliability – for CFOs this may mean disrupting the traditional approach to capital planning and investment.

In order to holistically approach productivity and efficiency, organisations need to include considerations of people, processes, governance, systems/technology, assets, and functional areas. This allows for an overall benefit to the manufacturing organisation in terms of improved and repeatable product quality, more robust compliance, reduced spoilage, and connects to optimisation efforts for a system level alignment across all areas of the business.

5. Energy efficiency

Rising energy and utility costs are driving up manufacturing costs. But, improving efficiency and optimising operations will lead to consuming less power and other consumables, which has the added benefit of contributing to decarbonisation targets.

Typical sources of inefficient energy use and resources in manufacturing operations are the shutdown and startup cycles which make them a target for optimisation opportunities. This can done by improved maintenance practices and planning, allowing for planned shutdowns as opposed to reactive breakdowns. Having a strong view of the organisation’s supply chain, planning for uncertainty, and collaborating effectively with external partners are all part of an effective approach to reduce energy and resource consumption across the organisation.

6. Supply chain optimisation

In the dynamic landscape of manufacturing, an optimised supply chain plays a pivotal role in enhancing operational efficiency and ensuring business success. The key to achieving this lies in adopting a holistic view of the supply chain, with a focus on minimising downtime, mitigating risks, and optimising productivity by having a clear view of the organisational target operating model (TOM) across the supply chain. By implementing effective demand planning and integrating it with inventory management, ERP and operations, manufacturers can make the most of their supply chain.

A more predictable supply chain is inherently better, as it allows for improved long-term purchasing decisions and minimises the risks associated with unplanned downtime and failures. Demand planning is vital in informing production schedules, inventory management, and overall operations. And, it helps manufacturers align their production and manufacturing mix with market demands, resulting in increased productivity and reduced changeover time.

Furthermore, supply chain optimisation goes beyond internal processes and extends to collaboration with suppliers and partners. Establishing strong relationships and communication channels with suppliers allows for better coordination, improved lead times, and increased reliability. Leveraging technology and data-driven insights can enhance visibility across the supply chain, enabling proactive decision-making and rapid response to changes in market conditions. Any decision or initiative on the optimisation of assets needs to be made with this holistic supply chain consideration to ensure organisational success rather than a siloed asset performance achievement.