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The problem with a TLA is that there is a limited number of combinations that make sense. And even once you have found the right meaning for a TLA, like PLM you discover so many different interpretations.
For PLM I wrote about this in my post PLM misconceptions –: PLM = PLM ?
I can imagine an (un)certain person, who wants to learn about PLM, might get confused (and should be – if you take it too serious).
At the end your company’s goal should be how to drive innovation, increase profitability and competiveness and not about how it is labeled.
As a frequent reader of my blog, you might have noticed I wrote sometimes about ALM and here a similar confusion might exist as there are three ALMs that might be considered in the context I am blogging.
Therefore this post to clarify which ALM I am dedicated to.
So first I start with the other ALMs:
ALM = Application Lifecycle Management
This is an upcoming discipline in the scope of PLM due to the fact that more and more in the product development world embedded software becomes a part of the product. And like in PLM where we want to manage the product data through its lifecycle, ALM should become a logical part of a modern PLM implementation. Currently most of the ALM applications in this context are isolated systems dealing only with the software lifecycle, see this Wiki Page
ALM = Asset Lifecycle Management (operational)
In 2009 I started to focus on (my type of) ALM, called Asset Lifecycle Management, and I discovered the same confusion as when you talk about a BOM. What BOM really means is only clear when you understand the context. Engineers will usually think of an Engineering BOM, representing product as specified by engineering (managed by PDM). Usually the rest of the organization will imagine the Manufacturing BOM, representing the product the way it will be produced (managed mostly in ERP).
The same is valid for ALM. The majority of people in a production facility, plant or managed infrastructure will consider ALM as the way to optimize the lifecycle of assets. This means optimizing the execution of the plant, when to service or replace an asset ? What types of MRO activities to perform. Sounds a lot like ERP and as it has direct measurable impact on finance, it is the area that gets most of the attention by the management.
ALM = Asset Lifecycle Management (information management)
Here we talk about the information management of assets. When you maintain your assets only in a MRO system, it is similar like in a manufacturing company when only using an ERP system. You have the data for operations, but you do not have the process in place to manage the change and quality of data. In the manufacturing world this is done in PDM and PLM system and I believe owners/operators of plant can learn from that.
I wrote a few posts about this topic, see Asset Lifecycle Management using a PLM system, PLM CM and ALM – not sexy or using a PLM system for Asset Lifecycle Management requires a vision and I am not going to rewrite them in this post. So get familiar with my thoughts if you read the first time about ALM in my blog.
What I wanted to share is that thanks to modern PLM systems, IT infrastructure/technologies and SBA it becomes achievable for owner/operators to implement an Asset Lifecycle Management vision for their asset information and I am happy to confirm that in my prospect and customer base, I see companies investing and building this ALM vision.
And why do they do this:
- Reduce maintenance time (incidental and planned) by days or weeks due to the fact that people have been working with the right and complete data. Depending on the type of operations, one week less maintenance can bring millions (power generation, high demand/high cost chemicals and more)
- Reduce the failure costs dramatically. As maintenance is often a multi-disciplinary activity errors due to miscommunication are considered as normal in this industry (10 % up and even more). It is exactly this multi-disciplinary coordination that PLM systems can bring to this world. And the more you can do in a virtual world the more you can assure you do the right thing during real maintenance activities. Here industries similar as for the previous bullet, but also industries where high-costly materials and resources are used, the impact on reducing failure costs is high.
- Improve the quality of data. Often the MRO system contains a lot of operational parameters that were entered there at a certain time by a certain person with certain skills – the fact that although I used the word certain three times, the result is uncertainty as there is no separate tracing and validation of the parameters per discipline and an uncertain person looking at the data might not discover there is an error, till it goes wrong. Here industries where a human error can be dramatic benefit the most from it (nuclear, complex chemical processes)
Conclusion: The PLM system based ALM implementations are more and more becoming reality next to the ALM operational world. After spending more then three years focused on this area, I believe we can see and learn from the first results.
Are you interested in more details or do you want to share your experience ? Please let me know and I will be happy to extend the discussion
Note: On purpose I used as much TLA’s to assure it looks like an specialist blog, but you can always follow the hyperlink to the wiki explanation, when the TLA occurs the first time.
The trigger for this post is based was a discussion I had around the Autodesk 360 cloud based PLM solution. To position this solution and to simplify the message for my conversation partner Joe the plumber, I told him”: “You can compare the solution with Excel on-line. As many small mid-market companies are running around with metadata (no CAD files) in Excel, the simplified game changer with this cloud based PLM offering is that the metadata is now in the cloud, much easier to access and only a single version exists.”
(sorry for Autodesk, if I simplified it too much, but sometimes your conversation partner does not have an IT background as they are plumbers)
He was right and I had to go more in-depth to explain difference. This part of the conversation was similar to discussions I had in some meetings with owner / operators in the civil and energy sector, discussing the benefits of PLM practices for their industry.
I wrote about this in previous posts:
The trouble with dumb documents
Here it was even more a key point of the discussion that most of the legacy data is stored in dumb documents. And the main reason dumb documents are used is because the data needs to be available during the long lifecycle of the the plant, application independent if possible. So in the previous century this was paper, later scanned documents (TIFF – PDF) and currently mainly PDF. Most of the data now is digital but where is the intelligence ?
The challenges these companies have is that despite the fact information is now stored in a digital file, the next step is how to deal with the information in an intelligent manner. A document or an Excel file is a collection of information, you might call it knowledge, but to get access to the knowledge you need to find it.
Did you try to find a specific document in Google docs or SharePoint ? The conclusion will be the file name becomes very important, and perhaps some keywords ?
Is search the solution ?
To overcome this problem, full text search and search based applications were developed, that allow us to index and search inside the documents. A piece of cake for Google and a niche for others to index not only standard documents but also more technical data (drawings, scans from P&ID, etc, etc).
Does this solve the problem ?
Partly, as suddenly the user finds a lot more data. Search on Google for the words “Right data” and you have 3.760.000.000 hits (or more). But what is the right data ? The user can only decide what is the right data by understanding the context.
- Is it the latest version ?
- Is it reflecting the change we made at that functional position ?
- What has changed ?
And here comes the need for more intelligent data. And this is typically where a PLM system provides the answer.
A PLM systems is able to manage different types of information, not only documents. In the context of a plant or a building, the PLM system would also contain:
- a functional definition / structure (linked to its requirements)
- a logical definition / structure (how is it supposed to be ?)
- a physical definition / structure (what is physically there ?)
- a location definition / structure (where in the plant / building ?)
and this is all version managed and related to the supported documents and other types of information. This brings context to the documents and therefore it exposes knowledge.
As there is no automatic switch from dumb documents towards intelligent data, it will be a gradual process to move towards this vision. I see a major role for search based applications to support data discovery. Find a lot of information, but than have the capability to capture the result (or generate a digest of the result) and store it connected to your PLM system, where is it managed in the future and provides the context.
Conclusion: We understand that paper documents are out of time. Moving these documents to digital files stored in a central location, either in SharePoint or a cloud-based storage location is a step we will regret in ten years from now, as intelligent data is not only inside the digital files but also depending on its context.
Since the past six months I am involved in several discussions related to the (building) construction industry. If you look to this industry, it seems like this is one of the few industries without innovation in its processes.
Someone in the discussion even claimed that if a worker from the middle ages would come back to this century, he would be quickly adapt and understand the way people work. OK, there are some new tools and materials, but the way the building construction industry works has not changed.
And let’s look to productivity. Where in the past 60 years in all industries productivity has increased, I have seen a survey where productivity in this industry has not increased and even decreased a little.
Although the survey ends in 2003, another article caught my attention. Robert Prieto, Senior Vice President from Fluor Corporation wrote end of last year in Engineering News Record his viewpoint: Engineering-Construction Needs a New Model. Reading this article and the comments demonstrates there is a need for innovation in the building construction industry.
Failure costs up to 15 % and delayed deliveries are considered normal business in this industry, where if this would be applied to mid-market companies in the manufacturing industry, they would have gone bankrupt due to claims and lost profit.
If we look at this industry, the first excuse you hear is that every project is unique and that project execution is done by a group of loose connected suppliers, not really pushed to stay within the targeted budget. But you might ask yourself: what is the correct budget?
All participants are aware that not all requirements are clear, but no one wants to ask and invest further as to invest more in accurate cost estimation. This is not anticipated. It is about winning the bid with the lowest trouble and investment.
So who is to blame? First of all, the client who has a short term vision. By selecting the lowest bids and not pushing for in-depth analysis of the project delivery and operational costs in the long term, the situation will not change.
What if the client was using the basics of PLM – Product Lifecycle Management? For me PLM means a connection and sharing of the concept phase, the delivery phase, production phase and maintenance phase.
What I consider as strange is the fact that in the engineering and construction industry these four phases are not connected and often that the maintenance phase (operations) is not taken into account during the concept phase.
And then there is the data handover. After engineering and construction specific data is handed over to the maintenance organization. What is the quality of the data, how applicable is it to the maintenance organization and how does it support maintenance is not clear. There is a disconnect and loss of knowledge as the handover is just based on the minimum data required.
What if the engineering construction industry would use PLM best practices, like:
- Requirements Management – connecting, implementing and validating all the requirements from each stakeholder. Making sure all requirements are considered and negotiated in a structured manner – no excuse for surprises.
- Data sharing with versions and status. Instead of a handover, data becomes mature during the lifecycle of the project. It requires the maintenance organization to be involved from the start
- Standardized validation and approval processes related to requirements and data. These processes might be considered as an overhead but they are the ones that lead to quality, risk and cost management
Conclusion: I believe connecting the engineering and maintenance phase for engineering construction companies will lead to higher productivity and quality. For sure the initial engineering cost will be higher, but during the construction and maintenance phase these costs will be recovered and probable much more – here is the ROI
As my intention was to write shorter blog posts this year, I stop at this point and look forward to your comments for a further discussion.
YOUR THOUGHTS ??
- Why PLM 2.0 – Conclusions (virtualdutchman.com)
In the past months, I have talked and working with various companies about the topic of Asset Lifecycle Management (ALM) based on a PLM system. Conceptual it is a very strong concept and so far only a few companies have implemented this approach, as PLM systems have not been used so much outside the classical engineering world.
Why using a PLM system ?
To use a PLM system for managing all asset related information ( asset parameters, inventory, documents, locations, lifecycle status) in a single system assures the owner / operator that a ‘single version of the truth’ starts to exist. See also one of my older posts about ALM to understand the details.
The beauty lies in the fact that this single version of the truth concept combines the world of as-built for operators and the world of as-defined / as-planned for preparing changes. Instead of individual silos the ALM system provides all information, of course filtered in such a way that a user only sees information related to the user’s role in the system.
The challenge for PLM vendors is to keep the implementation simple as PLM initially in its core industries was managing the complexity. Now the target is to keep it extremely simple and easy to used for the various user roles, meanwhile trying to stay away from heavy customizations to deliver the best Return on Investment.
Having a single version of the truth provides the company with a lot of benefits to enhance operations. Imagine you find information and from its status you know immediately if it is the latest version and if other versions exists. In the current owner / operator world often information is stored and duplicated in many different systems, and finding the information in one system does not mean that this is the right information. I am sure the upcoming event from IDC Manufacturing Insights will also contribute to these findings
It is clear that historically this situation has been created due to the non-intelligent interaction with the EPC contractors building or changing the plant. The EPC contractors use intelligent engineering software, like AVEVA, Bentley, Autodesk and others, but still during hand-over we provide dumb documents, paper based, tiff, PDF or some vendor specific formats which will become unreadable in the upcoming years. For long-term data security often considered the only way, as neutral standards like ISO-15926 still require additional vision and knowledge from the owner/operator to implement it.
Now back to the discussions…
In many discussions with potential customers the discussion often went into the same direction:
“How to get the management exited and motivated to invest into this vision ? The concept is excellent but applying it to our organization would lead to extra work and costs without immediate visibility of the benefits !”
This is an argument I partly discussed in one of my previous posts: PLM, CM and ALM not sexy. And this seems to be the major issue in western Europe and the US. Business is monitored and measured for the short term, maximum with a plan for the next 4 – 5 years. Nobody is rewarded for a long-term vision and when something severe happens, the current person in power will be to blame or to excuse himself.
As a Dutch inhabitant, I am still proud of what our former Dutch government decided and did in the after the flooding in 1953. The Dutch invested a lot of money and brain power into securing inhabitants behind the coast line in a project called the Delta Works. This was an example of vision instead of share holder value. After the project has been finished in the eighties there was no risk for a severe flooding anymore and the lessons learned from that time, brought the Dutch the knowledge to support other nations at risk for flooding. I am happy that in 1953 the government was not in the mood to optimize their bonus ( an unknown word at that time)
Back to Asset Lifecycle Management ….
Using a PLM system for asset lifecycle management provides the economical benefits by less errors during execution (working on the right information), less human involvement in understanding the information ( lower labor costs) and lower total cost of ownership (less systems to maintain and connect by IT).
But these benefits are in no relation with risk containment. What happens if something goes really wrong ?
If you you are a nuclear plant owner, you are in global trouble. A chemical plant owner or oil company can be in regional trouble, but they also will suffer from the damage done to their brand name globally. Other types of plant owners might come away with less, depending on the damage they potential ‘embank’
The emerging visionaries
For that reason, it is enlightening to see that some companies in Asia think different. There the management understands that they have the opportunity to build their future in a more clever way. Instead of copying the old way EPC contractors and plant owners work together, they start from a single version of the truth concept, pushing their contractors to work more integrated and clever with them. Instead of becoming boiling frogs, they are avoiding to fall into the same trap of many owners / operators in European and US based companies: “Why change the way we work, it does not seem to be so bad”
It requires a vision for the long term, something that will lead to extra benefits in the long term future: more efficient management of their assets, including risk containment and therefore being more competitive. If European and US-based companies want to be dominating in this industry they will need to show their vision too ..
Tomorrow I am attending the European Chemical Manufacturing Masters conference in Berlin, where I hope to learn and discuss this vision with the participants. I will keep you updated if i found the vision …..
As today it was again ‘Black Saturday”, the day that the French and German roads are filled with cars and traffic jams above100 km length, it was a moment for me to reflect in the middle of my summer holiday. I do not want to make other continents jealous, but the summer holiday is important (and long), still time for some thoughts.
PLM is dead, long live Social / User focused PLM ?
In one of my old 2008 posts, PLM in 2050, I predicted that PLM would no longer exist at that time, as companies would no longer focus on individual systems, but on full coverage of business processes, through integrated and federated data sources. I see this trend coming from two major PLM vendors (Dassault Systems / Siemens) with their 3DLive / HD PLM concepts. These concepts are trying to provide a unique user experience, where in an intuitive manner, a user in a specific role can obtain relevant data, analyze and simulate it in a virtual environment. Here the PLM vendors are really taking the lead to become the main platform for product development processes. Will the name PLM disappear at a certain stage ?
Additional you see startups and also some of the major PLM vendors experimenting with community concepts, social media. Moving towards a “Facebook’- like environment for product development and collaboration processes. The idea behind this direction is partly driven by the fact that the old generation of workforce slowly moves towards retirement where the new generation is not motivated to follow up the same working processes and procedures. The old generation moved from paper-based, manual processes to terminal-like screens, email and excel sheets.
If the new generation of employees will benefit from Facebook like environments is the question. Product development and collaboration requires a lot of boring data entry, even if we have a unique user experience. In addition, I was reading a preview of some research done with American and Dutch students, stating that study results from those students active on Facebook are significant lower as the result of student not active on Facebook, although they spend the same time on internet. I haven’t found the original source – here is a Dutch link. Curious to learn who will develop and bring better products to the market in the future with modern social PLM ?
ALM based on PLM is underestimated by owner /operators
As I have been active the past two years in some Asset Lifecycle Management projects based on PLM, I also feel that many owner/operators do not have the understanding or guts to change the way they are working. Understandable from their point of view – as long as the errors and risks are acceptable, why change the way the whole industry is working ?
In the nuclear industry you see the awareness growing. People know the risks of a nuclear disaster (after Chernobyl) and as we need more energy resources, nuclear energy with enhanced containment of risks is a natural way to go.
Perhaps after the BP disaster in the Mexican gulf, where apparently to the various reports, people were taking the wrong decisions due to inaccurate data or due to lack of information (could not be found in time) ALM based on PLM could be considered. However, investing even a few millions and changing the company’s way of working will never be approved by the BP management, as it will never happen a second time. It is all about being proactive (which is not a natural behavior) or being reactive and trying to control the damage. Here I have no predictions for 2050, I only believe that the proactive companies have a higher chance of survival – no matter which industry
But now my holiday activities call me back – for those not blessed by a holiday, here an overview of some of the relevant posts from the past year/
PLM and Organization
and if these links are not enough – look at my favorite blogs:
This time it is hard to write my blog post. First of all, because tomorrow there will be the soccer final between Holland and Spain and as a Virtual Dutchman I still dream of a real cup for the Dutch team.
Beside that I had several discussions around PLM (Product Lifecycle Management), CM (Configuration Management) and ALM (Asset Lifecycle Management), where all insiders agreed that it is hard to explain and sell the value and best practices, because it is boring, because it is not sexy, etc, etc.
So why am I still doing this job…..
Product Lifecycle Management (PLM)
Dassault Systemes introduced in 2006 3DLive as the 3D collaboration layer for all users with the capability to provide in a 3D manner (see what you mean) on-line role specific information, coming from different information sources. Recently Siemens introduced their HD PLM, which as far as I understood, brings decision making capabilities (and fun) to the user.
Both user interfaces are focusing on providing information in a user-friendly and natural way – this is sexy to demonstrate, but a question never asked: “Where does the information come from ? “
And this is the boring but required part of PLM. Without data stored or connected to the PLM system, there is no way these sexy dashboards can provide the right information. The challenge for PLM systems will be to extract this information from various applications and from users to have the discipline to enter the needed data.
Those software vendors, who find an invisible way to capture the required information hold the key to success. Will it be through a more social collaboration with a lot of fun, I am afraid not. The main issue is that the people who need to enter the data are not rewarded for doing it. It is downstream the organization, in the product lifecycle, that other people benefit from the complete information. And I even suspect in some organizations that there are people who do not want share data to assure being required in the organization – see also Some users do not like the single version of the truth.
So who can reward these users and make them feel important. I believe this is a management job and no sexy (3D) environment will help here
Configuration Management (CM)
Although it is considered a part of PLM, I added configuration management to my post as a separate bullet. Two weeks ago, I attended the second day of the CMII Europe conference in Amsterdam. What I learned from this event was that the members of the CMII community are a group of enthusiastic people with somehow the same vision as PLM missionaries.
Quoting the organization: “CMII is about changing faster and documenting better. It is about accommodating change and keeping requirements clear, concise and valid.”
And it was interesting to listen to speeches of the members. Like with PLM, everyone is convinced configuration management brings a lot of value to a company, they are also fighting for acknowledgement. Not sexy is what I learned here and also here those people who are responsible for data accuracy are not necessary the ones that benefit (the most).
Like PLM, but even more in Configuration Management, the cultural change should not be neglected. Companies are used to have a certain level of “configuration management”, often based on manual processes, not always as efficient, clear and understood and satisfactory for the management, till something happens due to incorrect information.
Of course the impact of an error differentiates per industry, a problem occurring due to wrong information for an airplane is something different compared to a problem with a sound system.
So the investment in configuration management pays of for complex products with critical behaviors and in countries where labor costs are high. It was interesting to learn that a CM maturity assessment showed that most companies score below average when it comes to management support and that they score above average when talking about the tools they have in place.
This demonstrates for me that also for configuration management, companies believe tools will implement the change without a continuous management push. I remember that in several PLM selection processes, prospects were asking for all kind of complex configuration management capabilities, like complex filtering of a product structure. Perhaps pushed by a competitor, as at the end it was never implemented
Asset Lifecycle Management (ALM)
In some previous posts, I wrote about the benefits a PLM system can bring, when used as the core system for all asset related information. For nuclear plants, the IAEA (International Atomic Energy Agency) recommends to use configuration management best practices and I have met an owner/operator of a nuclear plant who recognized that a PLM system brings the right infrastructure, instead of SAP for example, which has more focus on operational data.
Also I had a meeting with another owner/operator, who was used to manage their asset data in a classical manner – documents in an as-built environment and changes of documents in various projects environments.
When discussing the ALM best practices based on a PLM system, it was clear all the benefits it could bring, but also we realized that implementing these concepts would require a conceptual revolution. People would need to start thinking asset centric (with lifecycle behavior) instead of document centric with only revisions.
This kind of change requires a management vision, clear explanation of the benefits and a lot of attention for the user. Only then when these changes have been implemented, and data is available in a single repository, only then the fun and sexy environments become available for use.
PLM, CM and ALM are not sexy especially for the users who need to provide the data. But they provide the base for sexy applications where users have instant access to complete information to make the right decisions. To get there a cultural change is required. The management needs to realize that the company changes into becoming proactive (avoiding errors) instead of being reactive (trying to contain errors); investing upfront and never be able to know what the losses would be in case an error occurred.
Not sexy, however the benefits this approach can bring allow employees and companies to continue to do their work for a secure future
And now … time to close as the final is near
The past month I have been very busy in a specific area where PLM is not yet as understood. Where PLM is a ‘must have’ for companies developing and manufacturing products, in the world of Asset Development and Asset Management not many companies are yet aware of the benefits PLM can bring. I wrote about it in one of my previous posts . I will share some of my experiences here and I must thank Stephen Porter for mentioning my blog in his review (and pushing me to write today – even during the soccer championships in South Africa.
PLM benefits for Owner / Operators
I had discussions with a few owner/operators in the past week and as they all came from different industries (nuclear power generation / gas distribution / chemical processing), the details might differ but the values a PLM system can bring is for all of them the same.
When talking to Owner/Operators there are a few standard situations you observe:
- The usage of a transactional system (MRO / ERP /SCADA) which is managing the operational and financial activities as job scheduling and purchasing. Main dominant players in this area are Maximo and SAP. Most Owner / Operators believe that this is the only main system they need.This looks very similar to what we see in the typical manufacturing companies. They all have an ERP system, and specially in the mid-market these companies are not looking for another major IT-system.
The problem with only the transactional system as the core system for the company is that there is no natural storage for product or process information that can change (the Intellectual Property of the company). Transactional systems use pointers to actual product or process information that they require. But where do they store other and historical information ?
- The challenge to manage in parallel data for maintenance, rework and innovation projects. As the transactional system provides data for the operational environment, these companies are used to copy out data to their project environment avoiding not released project data can be seen in the operational environment. Another situation in relation to the engineering projects is that the owner / operator usually outsources the engineering work to EPC contractors and only coordinates the activities taking ownership of the data only after the new installation is under operation
The two owner / operators I met in the past month were in two different stages. The first one had already many years of experience in maintaining the plant operational and there they understood that the SAP PM module could not help them managing all required plant information around scheduled maintenance projects. Having already four different document management systems in place, the biggest challenge remained to coordinate the different baselines for the various projects scheduled for the annual maintenance. At the end they developed the concept where the PLM system is the owner of all plant related information, based on an Asset Structure in PLM and the PLM system ‘pushes’ the right information to SAP when the changes become operational.
The other owner / operator was in the early stage. They were planning to have a process to become operational. Their understanding is that they need only one system that provides them all the time the actual information and if needed also all the history and approvals of each of the components. For sure the actual information needs to be managed in a transactional system (SCADA) and for sure the SCADA vendor will say they can manage all information in their system. The pity for this owner / operator is that once they need historical data, or need to manage complex maintenance projects, they have lost the opportunity to do it right from the beginning.
Of course there is also a significant difference between the two owner operators.. The first owner / operator is situated in the Nordics, where the cost of labor is high. This means investing in IT-solutions to assure people are working with the right information brings a much faster ROI as compared to the owner / operator from South Europe. Sometime the labor cost can be one-third or less in comparison to the Nordic countries.
The owner/operator in the South Europe will initially not focus on efficiency and reducing labor costs. Due to the economical crisis unemployment is also high, so working with less people – improving by investments in IT are also not a popular measure.
But for all owner/operators a main consideration should be to remain competitive also over 10 – 20 years. Short term strategy is not good for this type of companies
Conclusion so far:
PLM concepts are bringing competitive benefits for Owner/Operator, despite the fact that they do not develop products. The value is based on bringing a single version of the truth (no island systems) and working in a single environment for the as-built and the to-be environment, without data conversions or transitions
next post I will talk about Asset Development and the PLM benefits
Although I am still active most of my time in ‘classical’ PLM, some of the projects I am involved with also deal with Asset Lifecycle Management. In general PLM focuses on a product development process, starting from a conceptual phase, going through planning, development and production. The PLM system serves as a collaboration and information backbone for all product IP (Intellectual Property). One of the main capabilities a PLM system provides is a ‘single version of the truth’.
And it is this capability, which makes a PLM system an excellent choice for Asset Lifecycle Management
Who practices Asset Lifecycle Management ?
Asset Lifecycle Management can be found at any location, where a company is maintaining a process – we call these companies Owners/ Operators. Best known industry for Asset Lifecycle Management is the Process & Power industry, where a company produces oil, energy or chemicals. However the same concept is also valid for water companies (water distribution process), food processing and infrastructure companies (railways, airports, roads)
All these companies have in common that they support a certain process and the challenge is, while being in operation, to optimize the process. During operation, maintenance and improvement activities should be as little as disruptive as possible.
A maintenance stop is very costly for Owner/Operators. Imagine a plant not producing fuel for two weeks (millions of liters) or a nuclear reactor not producing electricity for a month (millions of kilowatts) – no income. And no maintenance will lead to unexpected problems and in the worse case, disasters. So it is also about balancing these activities.
Let’s look at a definition of Asset Lifecycle Management
Asset Lifecycle Management is a balanced and active management of assets over the lifecycle, coupled with business objectives.
Simply said it translates into an approach, where based on business objectives (process stability, safety, margin) a company tries to optimize the usage of their assets (a reactor, a pump, a rail track, a road) through their individual lifecycles. This means perform preventive maintenance; renovate a part of the process and perform more parallel activities with a focus on improving the lifecycle of the process
So why not use a MRO system?
An MRO (Maintenance, Repair & Overhaul) system can be compared with an ERP system for manufacturing companies. The MRO system manages and schedules activities and resources on the plant, keeping track of maintenance activities done on inventory. But can it serve as the system providing the single version of the truth for all plant information? No!
So why not use an ERP system?
An ERP system is mostly used by owner/operators to control all financial transactions (contracts, purchasing, suppliers, projects/resources accounting). Some ERP vendors provide MRO functionality in a single system; still can this system provide the single version of truth for all plant information? Again I am sure it is not the case.
So why not use a document management system?
As most of the process information is stored in various types of documents, is seems to be appropriate to store all information in a document management system. And actually this is what owner/operators try to do, however they maintain inside their company different document management systems (paper archives, office documents in a specific system, engineering documents in another system, etc, etc). Each of the systems can provide a single version of the truth for specific content, however there is a consolidated single entry point for all asset data. Often the documents also do not reflect the status of an asset. Is the asset running in, is it active, is it demolished?
The tag number does not show it, and changing the status of an asset forces people to go through the various document systems to change the status there. An inefficient and costly procedure, not reliable and often not done.
So why not an integrated plant engineering system?
Engineering plant software is designed to support the design collaboration and is mostly used by EPC contractors. These engineering companies are hired by the owner/operator to design and construct the plant or make major modifications of the plant. EPC contractors need to work as efficient as possible (to get the job), which means for them work as intelligent as possible in an integrated manner with tag numbers, P&IDs, 3D Equipment, Piping, ISOs. This intelligence leads to an application specific format and infrastructure.
During the hand-over of the plant or modification, this intelligence disappears as the owner/operator does not use the engineering plant software. They do not want to be dependent on a single software provider or version of the data. As data has to live for many years, sometimes 30 years or more, application specific data is hard to maintain. So as part of the hand-over data will be provided in neutral formats, worst case paper, but often in PDFs, TIFFs or other publishing format, losing all the intelligence.
There is an intelligent, neutral format based on ISO 15926. This requires an investment from the EPC contractor and an investment from the owner/operator to manage all information in this format. For complex and long-lasting environments, like a nuclear plant, this approach surely pays off; however what you see is that on both sides (EPC and Owner/Operator) they try to minimize the costs on data handling/conversion. This leads in the long term to much more labor time internal at the owner/operator to manage and assure the data is accurate. But these costs somehow come later and are more hidden. And the question remains: can this system serve as the single version of truth for all plant information? No, plant engineering systems are too application specific
In addition, plant engineering software environments are not targeted to work integrated in an owner/operator environment, managing parallel projects and resources, quality processes and inventory statuses related to a certain asset and project.
So why not use a project management software system?
As in a plant many projects can run in parallel, it happens that they run on the same assets or locations in the plant. For engineers and maintenance it is important to have visibility on which projects have impact on each other. Project management software is not targeted to make data visible related to a collection of assets or locations. No, project management software can not be the system to serve as the single version of truth for all plant information.
So either we give up for looking a single version of the truth and pay the price for multiple software systems to maintain in the company and take the extra efforts for configuration management for granted, or we look at PLM ?
The PLM based solution
In the past 15 years I have done several projects with ENOVIA and projects where Asset Lifecycle Management was done with ENOVIA. For sure, other flexible PLM systems can do the same, as the solution lies in an adapted data model for ALM.
This picture shows what a PLM system can do:
It can provide all related information (documents, inventory, locations, and projects) to an asset with one click from within single system. In addition it can also give the actual status of the asset. Assets are often identified by tag numbers, and the lifecycle of an asset can be managed by default in a PLM system, combined with Asset Change processes.
Best Practices coming from the PLM world can be used here too. The major challenge for PLM vendors is to reduce the complexity for data handling, as ALM users will not be engineers experienced to complex CAD environments. They are information workers, who need with a short learning curve, direct access to the data they require (and they should be sure the data is reliable)
Note: the PLM system will need to interface with the MRO and ERP system. Like in the classical PLM concept, MRO and ERP are the transactional systems, controlling the day to day activities, where the PLM system provides the accurate plant information (IP) required for an activity.
Also the PLM system will manage the non-standard activities through projects, change processes and will rely on accurate information from ERP.
- Reduced down-time for the plant, due to better planning and accurate information when preparing a maintenance stop. Less surprises with unforeseen delays of production.
- More reliable and less effort to be complaint to safety, health, environment and governmental regulations as all information is available in a single, controlled and traceable environment
- Lower cost of ownership for ALM. Instead of maintaining various silos of information and provide access to certain users, a single system with a common interface is available for most of the users.
Conclusion: Owner/Operators should look into the benefits a PLM system can bring for them. Interesting the benefits are not based on the integration of product development, but on providing accurate information from different entry points for different roles
I am curious to learn who has seen a similar approach – feel free to comment