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W6__Hamda__ Pareto Priority Index (PPI) for Maintenance team __

1-      Problem Definition

Since the efficiency of each plant either Power Plant, Water Plant or other Industrial plant depends firstly on the efficiency and the life of its machines, because the high efficiency of machines means high efficiency of plants which will cause high quality of plant’s products. In order to ensure and keep the high efficiency of machines (Gas Turbines, Steam Turbines, and others) the plant scheduled a maintenance program (major inspection program) for such unit during a period of time (in Winter season). For that maintenance program, the project company may select a maintenance team either Internal Maintenance team (group of employees who work on the plant in maintenance department), Local Maintenance team (maintenance company where its location is in Oman), or Global Maintenance team (from outside Oman).

2-      Identify the Feasible Alternative

Three alternatives will be compared in this blog:

-          Option 1:  Local maintenance team.

-          Option 2: Global maintenance team.

-          Option 3: Internal maintenance team.



3-      Development of the outcome of Alternative

The feasible alternatives will be compared using Pareto Priority Index (PPI), by calculating the PPI using the below formula:



PPI= (Savings * Probability) / (Costs * Time of Completion- “years”)



There are 4 items to be known and considered in calculating the PPI as mentioned in the above formula such as:

·         Cost (USD): the cost of implementing the option. In plant case, it’ll consider the salary of the team for a period of one year, in addition to the other costs.

·          Saving (USD): the returns that the team is expected to present to the company in the form of savings (the money that the plant may save during the maintenance program) during a period of one year.

·         Time of completion (years): the time it takes to implement the option of selecting the suitable team for maintenance purpose.

·         Probability of success: how likely the team is going to succeed in their task during that period of time.


4-      Selection Criteria

The team with the high and biggest PPI value shall the plant selected as the main maintenance team for the maintenance program. 

5-      Analysis and comparison of the Alternative

The following table 1 summarizes the value of the inputs used each of the alternatives and the resulting PPI.
Options
Cost ($)
Savings ($)
Time (year)
Probability (%)
PPI
Option 1
70,000
90,000
0.5
70 %
1.8
Option 2
100,000
110,000
0.75
80 %
1.17
Option 3
30,000
50,000
0.33
90 %
4.54

6-      Selection of the preferred Alternative
Options
PPI value
Rank (highest to lowest)
Option 1: Local maintenance team.
1.8
2
Option 2: Global maintenance team.
1.17
3
Option 3: Internal maintenance team.
4.54
1

From table 2: it is clear that option 3 which is (selecting Internal Maintenance team) in order to do the maintenance program during the inspection period has the highest and biggest PPI value. So, the plant based on that value shall select this team.
7-      Performance Monitoring and the Post Evaluation of result
Selecting any team to do a specific task during a specific period of time is depending on main items such as the cost, savings, the time of completing the work and the probability of doing the work successfully by that team. The highest value of PPI which depends on that data, means the high priority of selecting that option. PPI analysis can be done from one time to another by updating the data.
            References:
1-      https://secure.gravatar.com/avatar/8fabcf5c647e88651764032384d44e0a?s=49&d=mm&r=gAuthor Tommy HendartoTommy Hendarto, 2017,W11_TH_Pareto Priority Index for Gas Station Project, Retrieved on 11 December from https://emeraldaace2017.com/2017/11/13/w11_th_pareto-prority-index-for-gas-station-project/
2-      Jared Munk, 2014, The Six Sigma Approach to Project Selection, Retrieved on 11 December from http://www.sixsigmadaily.com/the-six-sigma-approach-to-project-selection/
3-       Yaarub Alnaabi ,2017, W5_YN_Pareto Priority Index, Retrieved on 11 December from https://emeraldaace2017.com/2017/11/13/w11_th_pareto-prority-index-for-gas-station-project/

Comments

  1. Dr. PDGDecember 12, 2017 at 6:10 AM

    Hmmmmmm........ Great case study but I am worried about what MIGHT be bias in your analysis? IF hiring INTERNAL people was such a great deal then why are hospitals, universities and even many factories now OUTSOURCING maintenance services? IF having your own internal maintenance was orders of magnitude BETTER then why is this no longer a global trend?

    I am going to accept your blog posting but I would hope you do a bit more research on this topic as your conclusions CLEARLY are not consistent with what most of the rest of the world is doing right now:
    https://www.iofficecorp.com/blog/3-reasons-to-outsource-your-facilities-management-and-3-reasons-not-to
    https://www.chem.info/article/2014/05/pros-cons-outsourced-vs-house-maintenance
    http://feedforward.com.au/hr_outsourcing.htm
    http://www.engineerlive.com/content/maintenance-house-or-outsource
    https://www.efficientplantmag.com/2004/09/maintenance-outsourcing-is-the-answer-or-is-it/
    http://www.lvb.com/article/20151214/lvb01/312119989/property-maintenance-outsource-or-perform-inhouse

    Looking forward to another blog posting either confirming or refuting your original findings.

    BR,
    Dr. PDG, Jakarta

    ReplyDelete

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