But Steve Sonnenberg, president of Emerson Process Management, launched the discussion with the statement, “Reliability as a business strategy – a board-level activity. C-suite executives are seeing the need to better manage physical assets for improved profitability. With the right strategy, the typical $1 billion plant can save $12 million or more annually in maintenance costs.”
Jim Nyquist, group vice president PlantWeb Solutions, expressed the three factors of reliability as safety, availability, and profitability. Expressed as a formula, Nyquist explained “shareholder value = reducing safety incidents, improving availability, reducing maintenance costs.”
“Safety is job one,” Nyquist continued. “10% of time in transient conditions yield 50% of safety incidents. Marsh reports piping failures, startpup and shut down events continue to be significant causes of incidents.” As for availability, as much as 5% of production capacity is lost each year as a result of unplanned shutdown and as much as 43% of unplanned downtime is caused by equipment failure. A 1% gain in availability is worth $8.4 million of additional margin in a typical refinery.
Data leads to information which leads to knowledge and then finally action. For Emerson it begins with pervasive sensing and then asset management and control systems. The next step is to build reliability expertise. The company has been building services business, but it has also recently acquired Management Resources Group (MRG). Not only does this investment boost Emerson’s pervasive sensing solution, it also adds a number of experienced consultants. These consultants will help the company reach the next level of the progression–the “prescription” or the tools that allow customers to take prescription into action.
“If a company is not a top-quartile performer, it is losing millions in revenue and spending millions of dollars on unnecessary maintenance costs,” said Robert DiStefano, MRG’s founder and former CEO. “Every dollar not spent on maintenance goes directly to the bottom line. Our approach helps companies dramatically reduce downtime and enhance safety and compliance, increasing the stature and reputation of a company and ultimately providing better value for shareholders.”
Representative from three customer companies presented cases where monitoring and analysis drove improved business metrics. The companies were Corbion, PolyOne, and Lucite.
This new direction of Emerson’s is going to help manufacturers and producers complete the loop of design to operate to maintain. Plant, division and top managers will be provided a holistic view of operations and will therefore be poised to continually improve efficiency, asset utilization and profitability.