Cultural Change For Success: A Lumber Mill’s Renaissance
EP Editorial Staff | April 1, 2003
In the spring of 2000, Kenora Forest Products (KFP), a Prendiville Industries company located in Kenora, ON, was a moderately successful lumber mill. Our workforce consisted of approximately 10 maintenance personnel and 80 production personnel, one maintenance superintendent, and one electrical/instrumentation supervisor. Mill output was approximately 52 million board ft/yr of spruce, pine, and fir studs and fencing products. Our mill workforce was very capable and knowledgeable.
Knowledge, as I use it here, is defined as the capability for understanding and being able to use information and processes. As mill manager I knew, based on full run capacity, that our output could be increased substantially; holding us back was the combined effect of a multitude of relatively minor (individually) problem areas that produced frequent production stoppages.
In less than one year, the KFP mill, through work process improvements only, increased output to more than 80 million board ft/yr. How was a stud mill able to increase production by 54 percent without capital equipment or plant expansion? Through a complete cultural renaissance within the mill’s workforce.
The KFP workforce possessed an embedded, almost instinctive, knowledge of the mill’s established routines and processes. Within the maintenance organization these processes were basically reactive. The plant culture, its mindset gained through long-term practices, was to react to failures, fix broken equipment, and, in general, respond to production slowdowns and stoppages.
Our “repair-focused” culture was typified by attitudes that production runs it until it breaks and the maintenance crew is simply responsible for fixing the problem, without looking at its cause. This approach led to repetitive fixing of symptoms rather than resolving the problem causes. The general condition of our equipment was steadily deteriorating.
We did not have a computerized maintenance management system (CMMS) and the storeroom was snarled with a multitude of parts being ordered daily for jobs to be completed in the current week or even the current day. The parts that were in stock were not uniformly identified or systematically stored.
Solving such a multitude of smaller problems, which had created this repair-focused culture, was a question of finding a solution that addressed as many of the problem areas as possible. Our renaissance began in that first spring of the new century when a wellspring of change was created at KFP.
During the search for an integrated solution, a member of the mill staff attended a seminar entitled “Maintenance Excellence” presented by Life Cycle Engineering, Inc. (LCE), North Charleston, S.C., a company specializing in maintenance engineering. Its seminar addressed the essential elements for initiating transition to a world class maintenance operation. It also addressed the dramatic changes in equipment reliability, production, and profitability that could be expected from achieving maintenance excellence.
The employee’s enthusiasm, combined with the logic of the information, led me to conclude that the Maintenance Excellence philosophy must be applied to KFP’s maintenance operation and to the overall cultural mind set of the mill’s workforce. That day, we set out to reshape the mill in the form of the Maintenance Excellence model (see Fig. 1).
The path to cultural renaissance
The process for change began with a maintenance assessment to:
- Identify and prioritize the maintenance process problem areas
- Define the solutions and goals of changed processes
- Establish a base line of the maintenance effectiveness of the existing organization so that progress toward achievement of maintenance excellence could be accurately gauged.
In order to conduct an unbiased, objective evaluation, we sought an outside contractor to perform the evaluation of our maintenance operation as well as to provide support services and technical and management guidance to the mill for reconfiguring for maintenance excellence. LCE, the maintenance engineering firm that had presented the seminar, was selected. The company provided trained specialists to perform a comprehensive and structured maintenance assessment. Following the assessment, they performed an analysis of the gap between existing work processes and the best maintenance practices of maintenance excellence. The purpose of the analysis was to identify and prioritize the areas where changes were required.
Based on the maintenance assessment report and analysis, a master plan of action (MPOA) was developed to organize for and apply the Maintenance Excellence model within the mill. Major action items in the plan included:
- Selection and implementation of a functional CMMS
- Performance of equipment condition upgrade and restoration activities on critical, failure-prone equipment
- Identification of key maintenance effectiveness metrics (what data to collect, analyze, and track that could measure—and quantify—the impact of process changes on the effectiveness of maintenance activities)
- Development of equipment maintenance plans (EMP) to provide the foundation of a formal planned preventive maintenance (PM) program
- Development of bills of material to serve as the basis for determining storeroom stocking parameters
- Creation and establishment of the maintenance planning and scheduling function.
In order to successfully execute the MPOA, our next step was to develop a set of governing principles and operating practices that would define the mill’s goals and objectives, organizational strategies, and operating guidelines. The principles developed were then agreed upon by all mill management, union, maintenance, and operating personnel. These new principles, the defining factors of the new culture, were documented, signed by all participants, and prominently posted within the mill. This document has served as a reminder for all on how business would be conducted from that day on.
Next, applicable parameters and measurement/tracking methodologies (performance metrics) were identified to monitor, measure, and track the progress toward achieving maintenance excellence.
The pursuit of several of the major action items was facilitated through the creation of focus teams, staffed by both operations and maintenance personnel and provided with designated team leaders, to develop the details of individual action plans. The objective of the focus teams was to move promptly into implementation and execution as soon as the detailed action plans were approved.
One focus team was chartered to select and implement a CMMS. It was provided coaching and technical expertise from LCE. Through the use of a proven CMMS vendor selection process, three systems were identified and evaluated. Based on responses, budget, and vendor demonstrations, Ann Arbor, MI,-based CK Systems’ MaintiMizer 2000 was selected and implementation activities were initiated. A detailed standard operating procedure (SOP) was developed to ensure all process and utilization decisions were documented and standardized. The SOP would later become KFP’s “Maintenance Bible.”
A reliability focus team was chartered to address equipment reliability issues, which included evaluating and, where necessary, upgrading equipment condition and performing general restoration activities. The team also developed the EMP, making use of the current knowledge level and conditions observed during the equipment reliability evaluations and condition upgrades. The EMP would be the basis for development of the mill’s planned PM program. The reliability focus team’s activities accomplished a number of positive results:
- Identified the repairs, modifications, and upgrades required to restore the mill’s equipment to optimum operating condition
- Built a backlog of maintenance that would be required for proper planning and scheduling
- Very quickly began to influence operations through steadily increasing production output.
LCE again provided expertise to work with our maintenance staff to assist, coach, and mentor team members during these activities to ensure effective maintenance techniques were utilized.
A maintenance planner was selected from the existing team, and he was provided with extensive planner/scheduler training and follow-up in-mill coaching from LCE. Among the planner’s first responsibilities was the development of an equipment hierarchy (identification, parent-child and ownership relationships, standardized nomenclature, redundancy and commonality, etc.) for the entire plant. The equipment hierarchy provided the basis for tracking and relating labor, parts and material, and other costs to systems and equipment, down to the component level, as well as cataloging equipment history for each item in the mill.
We also decided to acquire a material management specialist to work with the planner, plant maintenance, and purchasing personnel to establish a functional storeroom. This allowed parts, materials, and consumables to be provided for maintenance tasks on a pre-planned basis and to establish more effective cost control measures. Almost immediately, this action resulted in a significant improvement in parts availability. Total cost of inventory was reduced dramatically and costs for emergency parts procurements were nearly eliminated. Later, the implementation of bar coding, integrated into the CMMS, further enhanced the efficiency of storeroom operations.
I felt that one final action item was needed to thoroughly imprint the change of culture within the mill. We instituted mill-wide training on the newly established workflow and all new work processes as well as CMMS operation and utilization, root cause failure analysis, storeroom procedures, and, through utilization of the metrics of maintenance effectiveness, the constant improvement process. This served not only to educate, but also to emphasize the importance of every employee in the mill for the success of the cultural change.
The renaissance completed
Within a few months of implementing these initiatives, the measures of maintenance effectiveness were visibly showing us that, through the performance of planned maintenance, more work was being accomplished and equipment reliability was improving steadily. Even more significant were the increase in production and the resulting climb in total sales revenues. With improved maintenance, the mill was able to start a third operating shift over the weekend. The combined effects boosted annual volume by 54 percent to 80 million board ft and reduced the operating cost per board foot produced dramatically.
Within 2 years of adopting the maintenance excellence culture at KFP, the results were more dramatic. The return on investment of the cost of implementation was nearly 10-fold. Today, I am convinced that, had Kenora Forest Products not embraced the tenets of maintenance excellence, the mill would not have survived the volatility of the lumber market and the increasing burden of tariffs imposed upon the company. MT
Fig. 1. Using this model enabled the mill to increase production by 54 percent without capital equipment outlays or plant expansion.