Chapter 1 Maintenance Organization
Chapter 1 Maintenance Organization
Chapter 1 Maintenance Organization
MAINTENANCE
ORGANIZATION
1
DEFINITION
MAINTENANCE
Activities required or undertaken to conserve as nearly,
DEFINITION
ORGANIZATION
A means for making people productive in working
together and arranging resources (people, materials,
technology, etc).
A social unit of people that is structured and
managed to meet a need or to pursue collective
goals. All organizations have a management structure
that determines relationships between the different
activities and the members, and subdivides and assigns
roles, responsibilities, and authority to carry out different
tasks. Organizations are open systems--they affect and
are affected by their environment.
4
DEFINITION
MANAGEMENT
The organization and coordination of the activities in
order to achieve defined objectives. Management is often
included as a factor of production along with machines,
materials, and money.
Management consists of the interlocking functions of
creating corporate policy and organizing, planning,
controlling, and implementing an organization's
resources in order to achieve the objectives of that policy.
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Preventive
maintenance
cost
Breakdown
maintenance
cost
Optimum
23
COST OF MAINTENANCE
Spare parts
Labor
Down time (production loss)
Overhead
Consumables
Hand tools, power tools and equipment
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In-house
Outsourcing
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DECISION TO OUTSOURCE
Lack of expertise
Too hazardous
No experience
Bound by contract
Top management policy
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NEED TO CONSIDER
Customer service
Loss of production
Loss of customer goodwill, reputation
Machine life
Availability of spare parts and expertise
Safety to the user / customer
Environmental problem (pollutant discharge etc.)
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Example
The record of computer breakdown for
Company PCK for the past 20 months is
shown below.
# of breakdown
0
1
2
3
4
8
6
2
Total
20
loss is RM300
Contract preventive maintenance by
company DK RM220 per month
Should PCK contract out preventive
maintenance to DK?
Solution
Step 1
Calculate expected number of breakdown
(based on past records) if the company
continue without service contract.
Step 2
Compute expected breakdown cost per
month with no preventive maintenance
contract
Step 3
Compute the cost of preventive maintenance
Solution
Step 4
Compare the two options and select the one
which cost less
Solution
# of breakdown Frequency
0
1
2
3
4/20 = 0.2
8/20 = 0.4
6/20 = 0.3
2/20 = 0.1
Step 1
Expected # of breakdowns = (# of breakdown) x (frequency)
= (0)(0.2)+(1)(0.4)+(2)(0.3)+(3)(0.1)
= 1.3 breakdown per month
Solution
Step 2
Expected breakdown cost = (expected # of breakdown) x
(cost per breakdown)
= (1.3) x (300)
= RM390 per month
Solution
Step 3 Calculate Preventive Maintenance Cost
= cost of expected breakdown + cost of service contract
= (1 breakdown per month x 300) + RM220 per month
= RM520 per month
Step 4 Compare
Less expensive to suffer breakdown without service contract.
Breakdown = RM390
Service contract = RM520
Therefore, continue present policy.