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"MRO Optimization Project" Gets Chemical Manufacturer Ready for OSHA Audit

After experiencing a major accident, a worldwide manufacturer of specialty chemical products was audited by the Occupational Safety and Health Administration (OSHA) which specified actions the plant needed to implement. OSHA noted that the facility did not have a program in place to ensure the appropriate parts were being used to repair or replace the intended piece of equipment. This created the potential for a significant impact to the health and safety of the employees and to the surrounding community and environment. At the request of the facility’s management, OSHA granted the manufacturer 12 months to put the necessary processes and procedures in place to minimize – if not eliminate – that risk.

Identifying the current-state deficiencies

The current state for this particular facility was not unlike many other companies: reactive, struggling with change, and working with limited data from a sub-optimized computerized maintenance management system (CMMS) that was implemented four years earlier. There were lots of spare parts scattered throughout the site, with some that were fairly organized and many that were in piles.

The facility had roughly 900 stock keeping units (SKUs) in their system, but no on-hand quantities, bin locations, dollar values, or history, and very few of the parts were connected to an asset. The facility’s team estimated they would need between 5,000 and 7,500 individual material items established and connected to the appropriate equipment, which would also require completing an asset hierarchy and creating as many as 1,000 bills of materials (BOMs) prior to the deadline.

Without any documented processes or procedures for the maintenance team to determine what was needed, what they had, what was used, and where it went, activities were running primarily through tribal knowledge.

Going above and beyond for world-class improvement

Recognizing the need for improvement in their MRO processes, coupled with a realistic view of their current state and a clear vision for the future, the management team partnered with Life Cycle Engineering (LCE), leaders in reliability engineering, to begin work on what was now called the “MRO Optimization Project.” The high-level expectations were defined as:
Complete the asset hierarchy and establish BOMs for all PSM critical assets
Inventory existing material; establish part numbers and enter on-hand and location data into the CMMS
Develop processes based on MRO best practices
Create detailed procedures for training and sustainability

These were identified as the minimum requirements to address the deficiencies noted by OSHA. However, the facility’s management team added in one more item to the scope, a new storeroom. They understood it wasn’t necessary, but they wanted a well-organized, state-of-the-art facility because their aspirations were much bigger – to become known as a world-class organization.

Partnering with the experts to achieve success

Working with LCE, a project plan was developed that expanded each scope item into greater detail, assigning owners, expected durations, and target completion dates.

The first activity was a walk-through of the site to determine which materials would be addressed as part of the project. The next step was a physical inventory that included identifying obsolete and unusable material, while capturing available inventory data (description, manufacturer, quantity, and location) of all potentially usable items.

While those activities were happening, the preparation of the new storeroom was underway. Existing materials were relocated, a non-load bearing partitioning wall was removed, the floor and walls were painted, and new LED lighting was installed. At the same time, a number of PPE items, consumables, and other materials were identified that could be vendor managed and issued from vending machines outside of the secured area of the new storeroom.

Both LCE and the site’s leaders thoroughly reviewed and revised the floor plan to ensure the final layout would optimize space and material flow while allowing some capacity for additional unplanned inventory.

The System Administrator for the facility began sorting through the baseline database to identify and eliminate duplicate items while also assigning part numbers to each unique MRO item expected to be used at the site. After reviewing LCE’s library of materials management best practices, the facility’s team identified 25 separate processes that needed to be implemented, which required customization to their operation and system as well as documentation of process steps, roles and responsibilities, and procedures to complete each process in their inventory control system.

The manufacturer’s on-staff Reliability Engineer (RE) identified all of the assets at the site considered to be PSM-critical, and began the process of ensuring that the assets were identified in their system and included in the asset hierarchy. The RE then started capturing data for each of the PSM-critical assets to build equipment BOMs, using P&IDs, OEM, supplier data, work order history, and available tribal knowledge.

Putting the finishing touches on a reliabilty overhaul

Within four months, the new storeroom was now available. Racks, shelves, and cabinets were installed and labeled. Transfer of inventory began, with on-hand quantities and new locations entered into the system. Excess inventory was segregated in a separate area of the site, procedures were finalized and tested, and a complete set of materials management metrics was established.

Over the course of the next month, training material for the new 25 processes was developed and delivered to all key stakeholders. The site’s management team completed a review in preparation for the OSHA follow-up audit and the overall results were extremely positive. After completing a few additional activities, the MRO Optimization Project was complete and the facility is now positioned for a successful OSHA visit.

To learn more about optimizing your MRO inventory, read
"Macro-Managing Your MRO Inventory."

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