 |
| Manufacturing risks extend beyond the boundaries of the site |
Risk management
tools are employed in some shape or form on most manufacturing sites. The two
most common areas in which they are used are for safety and plant maintenance
purposes, where risk- based approaches are used to identify potential failures
and devise mitigation strategies to prevent these failures from occurring. In
theory, the development of integrated quality management systems encompassing
safety, food safety, product quality, environmental issues and more recently
issues such as energy efficiency should involve some kind of risk assessment. In
fact, a risk assessment should be the foundation of such systems.
For reasons I refer to below, many organisations tend to gloss over this important
step and their risk registers are not as comprehensive as they should be. They
tend to identify risks through some kind of brainstorming process, which is not
in itself a bad approach, but can lead to a “high-level” assessment of operational
risks if the process is not sufficiently focused. The problem in manufacturing environments is that some very large risks
tend to have very small origins – the v-belt that is not tensioned correctly
and catches fire, burning down the facility; the valve that passes and
contaminates large quantities of food products; the extraction fan that is
never switched on and increases long-term occupational health problems for
employees through solvent inhalation....I could go on. While management teams
can and must identify strategic risks, operational excellence is largely about small
details.
One of the major
impediments to rigorous risk assessment is that it is resource-intensive. In
the maintenance environment, Reliability Centered Maintenance (RCM) is an example of
an approach that is shunned due to the amount of resources required to
partition a manufacturing plant to the required level of detail, identify
failure modes at the component level and then devise maintenance tasks to
prevent failures using decision trees. However, without making this investment in time upfront, potentially
catastrophic failures can go unidentified, and while the maintenance programme
may be improved after such failures occur, the costs incurred in learning
lessons in this way can be very high.
A second
challenge for those wishing to identify risks comprehensively is that this
requires subject matter expertise. If a group of people spends a considerable
amount of time conducting risk assessments but lacks this expertise, the
chances are the risk assessment will have serious shortcomings. So resources
will ultimately be committed but wasted, leading to disillusionment with the
process when unforeseen incidents occur. It is therefore vital that significant
investments are made in technical training and coaching, in order to equip
employees to participate productively in risk assessment events.
By now you can
see where I am going with this. Comprehensive, rigorous risk assessment is an essential
element of any strategy aimed at sustainable, stable, continuously improving
operational performance. Of course, risk assessment is only the first step,
solutions still need to be developed and implemented to mitigate each
individual risk in order to realise the benefits. The philosophy is simply that
if we can identify and mitigate every risk, we will achieve excellence. This is
in essence a lofty goal, since in practical terms, we will never be able to
prevent every potential incident. However, if we try our best to eliminate
every risk, those that remain will be small in number, and can be handled as
they arise in line with PDCA. If we chose to deal with every risk after the
fact with no risk identification upfront, we would be fire-fighting, and if
your facility tends to operate in an unstable fashion, chances are your risk
management practices need review.
The machinery through
which risks are mitigated is comprised of the various management systems in place. Quality Management Systems specify overarching policies, how
manufacturing process units should be operated, the parameters to be measured,
reporting, corrective actions and the like – essentially everything that needs
to be in place to ensure that excellent product quality, high levels of safety,
responsible environmental performance and other key objectives are realised.
These are however not the only systems through which risks may be managed.
Preventive maintenance programmes are a vital component of risk management in
the manufacturing environment. Human resource risks also require serious
consideration, and require standardised and rigorous processes and standards
for their management. Cost control procedures are a further example of tools
employed to manage risk. Many of these supporting systems reside in IT platforms. The organisations that are best at developing and implementing
quality management systems integrate these disparate systems into the overall
quality management system through explicit linkages. In general, the greater the number of unique
systems you have to integrate, the more difficult the task, and if you could
build an integrated system from the ground up you would have the ideal
management system.
The complexity
of quality management systems and the other programmes manufacturers may be
implementing at any point in time (such as continuous improvement programmes for
example) can lead to bureaucracy and confusion. In many cases a fixation with
the system rather than its efficacy means that results are erratic and do not
exhibit sustainable improvement. I am not knocking quality management systems
or continuous improvement programmes, both of which are important vehicles for the
achievement of operational excellence and sustainability. I do however believe
that there is a need for manufacturers to “get back to the basics” insofar as
obtaining and harnessing a fundamental knowledge of their operations is
concerned. Risk assessment provides an ideal vehicle for doing so. It does
however mean examining physical and business processes in minute detail, and
yes, this is time consuming and requires a lot of skill and knowledge to do
effectively. Once this has been done, the mitigation measures developed, if
implemented rigorously, will however go most of the way towards solid,
repeatable operational performance. Quality management systems provide the
ideal vehicle for execution of these mitigation measures. Continuous improvement
programmes require this sound foundation to be effective. Risk assessment
therefore lies at the heart of the well-oiled manufacturing machine,
particularly if the same approach used to identify risks is also used to
unearth opportunities. In a future post
I will give you an example of a detailed, integrated, process-level risk
assessment that will illustrate how powerful this approach can be as a platform
for operational excellence and sustainability.
Copyright © Craig
van Wyk, 2013. All rights reserved
