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The Reliability Secrets of North America’s most profitable steel manufacturer

A case study of Dofasco Inc.

Analyzing current maintenance practices

In the early 1990's, Dofasco discovered 70% of their maintenance efforts were reactive, only 30% proactive. Average equipment availability was only 78%. Product quality was not improving.

They had islands of maintenance data scattered throughout the company in OEM manuals and various condition monitoring systems. With an aging workforce, they were also at risk of losing significant expertise as employees retired. There was no central storage of critical information, and no way to easily access it.

The replacement value of Dofasco's equipment was 5 billion dollars, but maintenance efforts weren't properly coordinated or prioritized. They fixed whatever broke, instead of proactively managing their most important assets. Quality improvemen efforts were not coordinated and didn't necessarily focus on the most important equipment. Therefore, quality improvement efforts often died before reaching their objectives.

If Dofasco were a doctor maintaining human assets, they would have done one of two things: waited until the heart stopped beating and replaced it, or automatically scheduled heart transplants every 30 years just to be safe.

Dofasco recognized the need to improve their maintenance practices. They responded by developing a unique reliability driven maintenance methodology that propelled profits to record levels.

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The Reliability Driven Maintenance Proces

To maximize asset reliability, and to reach their strategic objectives, Dofasco developed a four phase process:

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1) Planning. Dofasco matches their maintenance policies to their strategic business objectives. They identify their most critical equipment. The equipment they can't afford to have fail: the heart that keeps the company alive. Then they analyze how, when and why the equipment fails. (To continue the medical analogy, they understand all the things that can cause a heart attack: smoking, increased cholesterol levels, excessive weight, high stress, etc.)

2) Assess. Dofasco measures and monitors all variables that affect the reliability of critical assets. They produce trending graphs that warn of progressive asset failures. (Dofasco monitors the patient's weight, blood tests and stress level.) If all the readings are acceptable, no maintenance is performed. If an indicator exceeds acceptable limits, an alarm is triggered. Dofasco then performs corrective maintenance, which usually prevents catastrophic failure. (When the patient starts gaining weight, Dofasco puts him on a diet before his heart fails.)

3) Improvement. Dofasco analyzes asset performance, and the effectiveness of both the reliability driven maintenance process and the maintenance work. They continuously look for ways to improve. (Just like doctors who continually research the cause, prevention and treatment of heart attacks to ensure the best medical care.)

4) Control. Dofasco uses a Computerized Maintenance Management System, to efficiently plan, schedule and execute work. (To finish the medical analogy, the most important surgery is planned, scheduled and executed efficiently. Dofasco utilizes CMMS technology to ensure that all maintenance activities are conducted as efficiently as possible.)

The Nuts and Bolts

The Dofasco methodology defines failure in terms of their overall business objectives. If customer demands require a machine to produce 100 tons per hour, "Functional Failure" is defined as the point at which output drops to 99 tons per hour. Failure is NOT when the machine stops working. Failure can also be defined in terms of target quality levels.

Depending on the particular asset, Dofasco may monitor numerous indicators, including: visual inspection results (Cracked, clogged, OK, etc.), vibration, process parameters, lubricant test results, electrical diagnostics and thermographic images. Their systems enable them to record and analyze trends in all data. Data is collected both manually and electronically, but all data is analyzed and processed in a single Reliability software system.

Dofasco uses the system to collect, store and reuse the expertise of its hundreds of experienced engineers and maintenance professionals. Rather than repeatedly recalculating complex indicator formulas and condition flow charts, Dofasco fully leverages their engineering talent by applying it to real engineering work. Self-directed trades people, not engineers, use the system's trending graphs, alarms and suggested corrective standard jobs to
manage the health of their assets. To quote one of their experienced tradespeople, "This system is really cool. It enables me to play a much bigger role in Dofasco's success. I love my job."

The Cost Savings

After implementing Reliability Driven Maintenance, Dofasco cut expenses by millions of dollars per year. Through attrition, Maintenance headcount was reduced by 50 percent. They reduced spare parts inventory from $110 million to $70 million, while increasing: equipment availability, productivity and profits.

The Strategic Benefits

Instead of being reactive 70% of the time, Dofasco's maintenance is now 80% proactive. Equipment availability increased by 10%. Before implementing this process, only 76% of output was sufficiently high in quality to ship to customers. Now, 91% of Dofasco's output is high quality. Customers are more satisfied with their steel purchases, and are more confident of their steel producer.

Dofasco is producing better quality steel at lower cost, with half the workforce. That's exactly what Dofasco needed to do to meet their overall corporate objectives.

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The Awards

Dow Jones recently ranked Dofasco as the world's number 1 steel maker for the past two years. Dofasco has also received two prestigious awards from the Canadian Maintenance Management Congress: "Best Maintained Large Plant" and "Best Use of Technology."

Becoming North America's most profitable steel company was the best reward of all. Dofasco's profitability ensures the company can expand and grow, at a time when many other steel companies are struggling to survive.

Can you apply Dofasco's Process to your Business?

Yes. Contact Ivara. Dofasco has partnered with Ivara to commercialize the reliability software technology and the reliability practices. Ivara offers everything you'll need to implement a Reliability Driven Maintenance Process. Ivara can help you to quickly maximize your equipment reliability to enable you to reach your strategic objectives. Even if your strategic objectives are aggressive and you want to become the most profitable company in your industry.

Ivara Corporation
935 Sheldon Court
Burlington, Ontario
Toll Free: 1-877-746-3787
www.ivara.com

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