Meridium

I have always been fascinated by the economic concept of opportunity cost.  Simply put, opportunity cost is the cost of not making a particular choice.  For example, the opportunity cost of dieting is missing out on eating all the delicious food that you want.  The opportunity cost of attending your daughter's school play might be missing one of your favorite TV shows.  

Considering opportunity cost makes for better decision making.  This is especially important because people often oversimplify decisions.  Oversimplifying decisions, using the examples above, could lead to a parent deciding to watch the TV show instead of the daughter's school play because of a simple metric like limiting gasoline usage.  If you only focus on one metric and that metric isn't the most important, you may miss the big picture.

MeadWestvaco is determined to not miss the big picture.  During their presentation at Meridium Conference, Gene Wakkuri and Ken Latino discussed how Meridium enables data reporting and analysis at MeadWestvaco.  These analyses lead to significant cost savings.  Going far beyond demonstrating typical maintenance cost reductions due to asset performance management, Ken Latino uses analysis to do what he calls "risk based budgeting."

"Risk based budgeting" came about because Ken Latino and his team were told that management was going to cut their budget by $10 million.  Cutting the maintenance and inspection budget by $10 million would clearly lower costs on the front end, but what about the opportunity cost?  If a company decides to not invest in preventive measures, how much risk does this add into the system?  Ken and his team wanted to find out.  Using Meridium's APM software, they analyzed all the preventive measures that would be eliminated due to the budget cut.  The analysis showed that cutting out so many preventive measures greatly increased the risks associated with asset failures.  Ken and his team took these findings to management.  When management saw the risk that a $10 million budget cut would add to MeadWestvaco, they gave Ken and his group $7 million BACK INTO THEIR BUDGET!  

Risk is real.  When left unmitigated, risk can take lives, destroy ecosystems, and devastate profits.  Rather than putting your company at risk but cutting value, analyze what you are doing.  For more information on tools to analyze equipment related risk, click here.

Joe Nichols, VP of Product Strategy gave an overview of the Meridium 3.5 release today at Meridium Conference 2012.   During his presentation Joe made reference to BMW's condition based service.  This is not something new.  The BMW 7 series car, starting in 2002, had installed technology that monitored certain measurement locations to determine the condition of the lube, the tires, the brakes, etc.

 The owner could opt to allow the local dealer to have access to this data.  The dealer would monitor the car's data, make service recommendations, and call the owner to set the appointment for servicing. 

Imagine what that does for safety, cost, and of course risk.  The brakes will tell you when the pads need to be changed and on what basis.  With some basic analytics the program could predict the lead time during which the brake condition will reduce in useable condition.  The warranty agreement between the consumer and the manufacturer is far more transparent because claims can now be based on evidence-based decisions rather than best-guess estimations (that typically puts the consumer at a disadvantage).

 Now what would make this inconvenient?  If the sensors and analytics for the engine were separate for the sensors and analytics were on a different platform the condition points would be in silos.  What if the local dealer used two different software point solutions to analyze brake data and another for engine data?  The dealer would call the owner in for work on the brakes and then a week after the brake service they would be called for engine service.  That's the danger of point solutions. 

Meridium APM software helps your assets communicate effectively with you.  So when your assets call you to make an appointment for servicing, you'll have all of the information you need based on all measurement locations through one integrated tool set.

Mike Matlock, SVP of Customer Sustainability at Meridium is addressing Meridium Conference this morning about what Meridium is doing to delight it's customers. Mike points out that Meridium has had many successful projects and is working to constantly focus on the right things. He made several points on building strong partnerships to achieve common goals. Several of these focuses were:

• Alignment
• Communication
• Teamwork

Meridium has adopted Meridium Project Management Methodology. This methodology focuses on developing the roadmap to value via multi generational planning , developing a business case and work process mapping tying it  together with specific project definition and development. Meridium wants to ensure that every project has minimal uncertainty, a plan for user adoption and minimal risk.

Meridium has invested significant time in developing  a methodology that uses best practices and focuses on being predictable in their processes. Meridium monitors and measures projects to keep an increased focus on value realization for their customers. This process is enabled by the feedback customers have provided and this collaboration ensures that projects are successfully implemented and closed out jointly on time. Meridium is working hard to keep its clients competitive and to create passionate users.

High speed analytics is dependent on in-memory computing. 

"Dramatically improved hardware economics and techology innovations in sofware have now made it possible for SAP to deliver on its vision of the real-time enterprise with in memory business applications"

Dr. Achim Krüger, VP, EAM Solutions at Meridium Conference 2012

• Meridium and SAP's solutions complement each other
• SAP Endorsed Business Solutions follow a specific qualification process
• Meridium and SAP are stribing to extend the partnership beyond RCMO
• New techologies provided by SAP (e.g. HANA)

This type of partnership will accelerate predictive analytics far beyond what asset managers can currently do in ways that they've haven't previously been able to do.

Dr. Achim Kruger, VP, EAM Solutions of SAP AG addressed Meridium Conference attendees on Thursday morning about the combined power of SAP and Meridium.  Studies have shown that maintenance costs around the world add up to around $447 Billion.  Hense, the opportunity for cost savings is huge provided that you clearly understand the potential.   

High preforming companies understand that in order to gain the most value they must expand their vision past maintenance management to true asset management.  Asset management and asset performance management require a more holistic approach.  This means that maintenance execution must be followed by maintenance analysis.  These analyses drive toward asset strategy development that includes risk evaluations and methodologies like RCM, FMEA, SIS, and RBI.

SAP and Meridium have enjoyed a long partnership working together to achieve asset performance management.  SAP helps companies with maintenance execution and enterprise asset management and Meridium's APM Software provides the analytical capabilities.  As part of their partnership, Meridium and SAP created RCMO, SAP's official RCM solution.  For more information on Meridium's software, click here.

Why are we here?

Companies spend one half trillion dollars on maintenance.

We're here to share ideas on how we can spend this money in the most optimal way possible. The asset management system is a key element that differentiates between whether that money is well spent or misspent.  Managing performance and risk is obvious to practitioners but it is not always readily understood by all functions of the organization. 

Achim Kruger of SAP walked the audience through the relationship between EAM and Meridium.  He explained the domain of SAP and how it is distinguished from Meridium functionality.  He also explained the software solution partner models.

Endorsed business solutions are complementary solutions selected by SAP product and solutions group.  There are several mandatory product standards that are derived from ISO 9126 software quality model.  SAP and Meridium are in discussions on extending the partnership and mapping the solution qualifications even further.

Peter Zornio, Chief Strategic Officer of Emerson Processes big growth in this area of asset management.  Oddly enough his opening message states that low technology maturity is one that has more technology than people and process together.  A high technology maturity organization has a equal balance of the right technology of people, process, and technology. 

• have you done a criticality analysis?
• do you have good working assets?
• have you integrated predictive intelligence?
• can you write a complete work order?

"We're not predicting failures... we're predicting when we need to go in and do something"

On the topic of big data, Emerson is going to be a key contributor of data.  Emerson devices are going to be "part of the problem", in a manner of speaking.  The key difference is that data alone will drown you.  If you can put it in a central location, put it in plain language, open access to the information in produces, this will make the difference between managing risk or allowing risk to manage you.

John Aller of Asset Optimization LLC addressed Meridium Conference about risk in reliability.  In his presentation, Aller told a story from his own experience in a previous company.  This previous company was a good company but its culture rewarded firefighting and reactive work.  A plant had an explosion which killed several employees.  OSHA came in and warned that the plant would not be able to restart until the problem were fixed and a plan was established to prevent future issues.  After the disaster was over, the people who were rewarded were those who helped clean up the mess.  Very little focus was placed on preventing the issue in the first place.

Risk management does not work this way.  Risk management is not something that can be done passively.  Risk is a part of every business.  As John Aller points out, many executives are hesitant to define their appetite for risk.  Some would rather not think about risk.  While risks don't need to be feared necessarily, risks should be respected.  Those who constantly think about risk are less likely to be ambushed by a problem.  When a problem does arrive, those who proactively work to mitigate risk are ready to address those risks.

Hope is not a risk strategy.  Companies need to be proactive, measuring risk retroactively and modeling risk proactively.  Often this is not as easy as it seems.  Often as companies do a qualitative risk analysis, they discover that their top 5% of risks have very obvious solutions.  These risks are managed in a systematic way.  Unfortunately, the other 95% of risk can be hard to mitigate without analytical tools.

Analytical tools can help companies to mitigate risk by first identifying problems and then facilitate recommendation management.  For example, many process safety risks can be mitigated through methodologies like Risk Based Inspection.  These methologies help companies to drive proactive risk mitigation strategies.  These methodologies are facilitated by tools like APM software.  For more information on Asset Performance Management, click here.

Eddie Amos of Juniper Networks spoke to Meridium Conference 2012 attendees about the potential opportunities relating to big data.  Big data is growing more and more as time goes on.  As an example, every day 4 billion new things are added to Facebook.  The world of data coursing through the internet added up to 5.3 zettabytes (5.3 trillion gigabytes) in 2011.

From mapping the human genome to inproved Google searches, the world is moving toward taking advantage of this big data.  This is done through analysis.  The medical field analyzes human genomes to discover the genetic root cause of diseases.  Producers of jet engines monitor the readings of 16 sensors within the engine in order to drive improvements and innovations (companies have discovered that a 1% improvement in efficiency based on changes driven by the sensor readings will ultimately result of billions of dollars of benefit). 

By using analysis, like those used in tools like APM software, companies benefit.  In the world of asset performance management and elsewhere, analysis provides companies with the ability to:

1. Enable the world to be definable and predictable

2. Capture the power of man and machine by leveraging technology and work processes

3. Transform trash into treasure, cutting out waste and getting use out of previously unusable sources (hidden plant)

The keys to success with big data are technology, processes, and algorithm.  For greater analysis capabilities in reliability, maintenance, and process safety, click here.

Here at Meridium Conference general session, Eddie Amos is discussing big data. As you probably have heard big data is the  new paradigm. The opportunity in mining data and making sense of our would is staggering. Industry leaders are already at work trying to help you make sense of the gigantic amount of data that you produce or want to access daily. Most of us have smart phones by now and maybe an ipad or other tablet and are connected 24 hours a day to information. If you are in the process or discrete industries more and more of your assets will be connected via smart measurement devices providing real time intelligence about its operation. Knowledge of the operation time energy and money in close to real time is on its way to being standard. Companies that run their business by compiling data using Excel spreadsheets will be soon be a thing of the past (if you want to stay relevant).

We live in a global environment and information is rapidly changing and growing at astounding rates. Having access to old data and taking to much time to act on it will leave companies that don't adapt at a competitive disadvantage. Big data has a huge impact on how we unlock information. There are plenty of statistics of the data boom and we know that it exponentially increases every couple years. The power you will have over this data will directly correlate to the tools you use and on how you mine and analyze the data. Unlocking the data alone will not get you the results you desire, but once you put context around this information you can then put in place a strategy that aligns to your goals. 

 Your data doesn't have to be perfect to get started. There is no such thing as perfect data. The worry is not keeping up with technology but the true driver is protecting people, the planet and profits. This week at Meridium Conference innovators in this field are sharing extremely valuable information to help you navigate your way to your goals.

Bonz Hart, President and CEO of Meridium, spoke to Meridium Conference 2012 attendees about Asset Answers.  Asset Answers is a new service provided by Meridium that allows companies to view their asset data and compare their reliability practices with those of their peers.

According to Hart, the need for industry related benchmarking has become increasingly more important due to the following industry trends:

1. There is a greater focus on Risk Reduction.

2. Companies are gathering accurate new data.

3. Companies need to be able to view their data in context.

4. Companies are increasingly having to deal with "Big Data."

Being able to compare their asset performance with their peers allows companies to see how well they are actually performing.  This knowledge can help companies to move toward reliability best practices, which in turn helps that company protect its people, the planet, and profits.

Asset Answers already has 5 charter member companies that have agreed to "take the plunge" as first adopters.  These companies include Dow Chemical, Profertil, Marathon, NOVA Chemicals, and DuPont.  Kevin Bauman of Dow Chemical commented that taking the plunge as a first adopter was not a risky step for Dow due to its positive history with Meridium and the quality of Meridium's products and services.  According to Bauman, Asset Answers and the ability to do reliability benchmarking is "truly a competitive advantage."

For more information on Asset Answers, click here.

The uptake of PAS 55 - what are the industry types that are adapting PAS 55?  Rhys Davies, Chair of ISO PC/251 presents at Meridium Conference 2012.  He offers us in international insight on the development of the ISO 55000 standard for asset management.  Some countries have government policies that govern asset management.

What is ISO 55000 standard?  Is it a standard on how to manage assets?  Nope.  Is it about asset performance management?  No sir.

Then what the heck is it about?

Bonz Hart, President and CEO of Meridium, opened up Meridium Conference 2012 talking about purpose. While so much of asset performance management is identified with maintenance and operations, Meridium has learned that great work processes and impressive technologies like APM Software have a greater mission.  Asset performance management is really about protecting people, the planet, and profits.  

People are a company's greatest asset.  Millions or billions of dollars saved in maintenance costs and lost production is substantial but life is priceless.  Ensuring that equipment doesn't break down unexpectedly is at the core of process safety.  Companies who want to protect their employees and members of their community use Meridium tools to drive methodologies like Risk Based Inspection.  

The environment is critical.  Preventing mechanical integrity problems like leaks and explosions also help to protect ecosystems in the environment.  Clearly, oil spills can devastate oceans and the seashore.  Cleaning up incidents like this take years and billions of dollars.  Such incidents also result in lawsuits.

Reliability also protects profits.  Reliable equipment is profitable equipment.  When equipment runs as it is supposed to, companies produce revenue from the products they produce.  Reliable equipment costs less to maintain.  These higher revenues and lower costs protect a company's profits.

This purpose is why Meridium does what it does.  By protecting people, the planet, and profits though reliability best practices and software tools, companies, individuals, and the planet benefit.  Reliability is at the forefront of ensuring that equipment operates safetly so that people stay safe.  Meridium Conference will show how these objectives are achieved over the next few days.

Risk is nothing more than the likelihood and consequence of an undesired (and the same) event.  Mr. John Aller, the world's top expert on mechanical integrity addresses Meridium Conference 2012.

Every process has risk.  There is some probability of something going wrong.  Think about the number of maintenance tasks being performed incorrectly.  Think about a project management scenario?  Ever seen a de-bottlenecking project that didn't de-bottleneck?   When we think about processes that can affect the asset performance of our plant the human element and the mechanical elements cannot be separated in risk management.

Risk is time stamped - very few risks are static.  Pretend that you're a burglar and you live in Tennessee and  you decided that you're going to break into someone's house and steal something valuable.  As you plot this deed, you overhear your intended victims neighbor mention the full breed German Shepherd.  Burglars are risk managers.  What would you want to know before you decided what an acceptable level of risk before you break in?

"When Maggie (the German Shepherd) was three months old she was still a German Shepherd but she was not as much of a threat than she is today", says Mr. Aller. 

In asset management doing nothing is always an option.  Sometimes it is the best option.  But risk is time-stamped.

In 2006 there were only 1 billion connected devices.  In 2011 there were only 5 billion connected devices.  By 2016 it is projected that there will be 14 billion connected devices - this will include the device to device connections.  Everything from you pet's collar to your car will have an IP address.  What then will happen with network traffic?  In 2011 the amount of digital traffic across the world was 5.3 Zettabytes, or one trillion gigabytes.  By 2016 it is projected that this traffic will equal 22 Zettabytes.

What does this mean to the world of asset management?  This is not business as usual.  The days of running your business off of an Excel spreadsheet are over.  When I speak to Meridium Conference attendees who run their risk based inspection process on an excel spreadsheet I'm astounded. 

Eddy's message - use the right tools for the right job.  When you work with a tool like Meridium APM Software you're using the right tool.

The opportunity - what can you do to make your organization more successful?  What's at the top of Intel's list?  Asset Performance!

Twenty years in the software industry is a long time.  Meridium Conference 2012 marks our 20th year and in software years that makes Meridium about 874 years old!

So what could be a good topic to cover at this significant juncture?  What does this Meridium really do?  Bonz Hart, CEO of Meridium walked the audience of asset management professionals through the concepts of asset performance management.

Assets fail and the big boss wants to know what happened.  He needs to know how long it was down, what failed, and why.  There are a lot of smart systems and wireless devices that gather lots of data.  But this still isn't enough because it just gives you more data to react to.  You need an strategy that lights the path between where you are now and where you need to get to.

Meridium Conference is not about software - it is about context.  It is about data, information, intelligence, wisdom.  Data without a context is meaningless.  Perhaps one of the most significant context generators is Asset Answers.  Kevin Bauman with Dow Chemical addressed the opening session to share why they made a commitment to be a charter member of Asset Answers.  How better could you build a performance management plan than to be able to benchmark inside your own organization?

Meridium Conference is in full swing at the Sawgrass Marriott in Ponte Vedra, Florida.  Just like past conferences, Meridium Conference 2012 has attracted attendees from all over the world.  Reportedly, this year's attendees have come representing 19 different nations.  Clearly, asset reliability is more than a North American idea, it is a universal concern.  Whether you are making chemicals in Argentina, refining oil in Canada, managing data in China, or drilling for oil in Saudi Arabia, reliability or the lack thereof affects what you do every day.

      The time has come that companies are realizing that asset reliability touches everything.  Gone are the days in which greater asset reliability only meant lower maintenance costs.  Assets that run reliably don't disrupt production.  They don't create safety hazards.  They don't cause chemical releases or oil spills.  They don't cause explosions.  Reliable assets mitigate risks and they make money consistently.  In order for plants to run and businesses to survive, assets need to be reliable.

     Asset reliability is critical but it doesn't happen on its own.  No one stumbles upon reliability best practices by accident.  Great reliability efforts take work and they require the right tools, like APM software.  There is too much data out there to keep up with it all on spreadsheets or paper records.  For this reason, attendees from 19 countries have come to Meridium Conference this week.  Subject matter experts are on hand to offer advice and guidance.  Peers can compare stories to find out what has worked to increase reliability and process safety, and what has not.  General conference sessions will include presentations on such themes as PAS-55, software updates, business cases, and industry trends.

     To follow conference updates, visit our Twitter page here.

It's that time of year again!  Meridium Conference will begin next week in Ponte Vedra (near Jacksonville), Florida at the Sawgrass Marriott.  Attendees are coming from all around the world to learn reliability best practices and learn tips on how to get even more value out of their APM Software.  As always, a variety of subject matter experts with expertise in everything from reliability methodologies to industry trends are lined up to speak.  This year's group of speakers includes:

Bonz Hart, President/CEO, Meridium

John Aller, Asset Optimization, LLC

Rhys Davies, Managing Director, Smart Asset Management Solutions Limited

Peter Zornio, Chief Strategic Officer, Emerson Process Management

Dr. Achim Kruger, VP, EAM Systems, SAP AG

Meridium Conference attendees are also able to attend presentations by Meridium customers and view business cases in the business and technical tracks.  Meridium subject matter experts will also be on hand to conduct software demonstrations of tools like Failure Modes and Effects Analysis (FMEA) and Risk Based Inspection (RBI).  Those who arrive early in the week can take part in value path clinics to help chart a roadmap forward to greater reliability and value.  For more information on Meridium Conference 2012, click here.

See you in Ponte Vedra next week!

Striving for reliability in the world today has become a greater priority for many companies than it has ever been before.  Due to difficult economic conditions, companies everywhere are looking to increase revenue and lower their costs.  With asset reliability comes equipment availability, predictable production and lower maintenance costs, all of which lead to greater profit for the company.

       Due to the potential benefits, many companies seek reliability in whatever way they can.  They buy vibration analysis tools.  They start looking up information about reliability centered maintenance.  They attend conferences.  They investigate the best analytical tools on the market, APM Software, and dream about the day when they won't have to run around the plant constantly fighting fires.  Unfortunately, despite their good intentions, very little changes.  Truly, reliability can be an elusive prey.

       Often times, life's challenges have simple answers but they are so simple that they are overlooked.  This is especially true in the world of asset performance management.  While Reliability Centered Maintenance (RCM) can be very useful, most plants are working to keep their heads above water.  They have too much work to do and they don't know where to begin (they just know that whatever they do, they must do quickly).

       Experience teaches that all endeavors are best executed when founded on a strong, stable foundation.  Just as buildings who lean or fall over without strong foundations or cars that drive out of alignment due to a damaged chassis, reliability initiatives will be ineffective if their foundational work processes are broken.  This foundational work process includes asset taxonomy, event coding, and asset criticality.

        For plants who need to be able to quickly prioritize their maintenance efforts, doing an asset criticality analysis can be both easy and effective.  Plants who need to set up asset criticality should try to be complete in assigning criticalities to assets.  But this doesn't mean that you have to take a long time doing it!  For the first pass, talk with your maintenance folks, your operators, and your plant manager.  They all likely have a good idea as to what the high criticality assets are.  They know which assets cripple day-to-day operations.  They know which assets contain the most volatile chemicals.  They also know which assets break down most often.  For ease of use, start with those assets and make them high criticality (you can always adjust later!).

       A firm foundation is necessary for implementing reliability best practices.  To learn more about foundational reliability work processes, come to Meridium Conference 2012!

The last of Stephen Covey's 7 habits for highly effective people deals with taking care of yourself by "sharpening the saw."  To "Sharpen the Saw" alludes to the practice of balancing needs and ensuring a sustainable improvement.  In his lectures, Stephen Covey teaches that people must consider their physical, emotional, mental, and spiritual health so that they don't burn out or hit the wall as they move towards effectiveness and success.

The same is true in the world of reliability and asset performance management.  Companies who focus all their energy in one area may adversely affect the other areas of their company.  For instance, a company concerned with cutting costs may decide to lay off large numbers of employees only to find out that their potential for innovation decreases and company morale suffers.  On the other hand, if a company focuses all of their resources on risk management, they will soon see that their costs are rising.  This is the equivalent of focusing on spiritual goals by fasting for two entire weeks to the detriment of the physical health of the body.  There needs to be a balance.

In order to find this ideal balance in reliability, many effective companies turn to analytical tools like Meridium's APM Software.  Such tools allow companies achieve sustainable improvement by telling companies how much time and resources to invest in each of their areas of focus.  If the focus is reducing risks, analytical tools can show how to prevent failures without overdoing preventive maintenance.  Effective companies cut costs by eliminating waste in ineffective work processes.  They optimize their work to the point that they are doing the minimum amount of preventive work while still protecting themselves from unplanned events.

When everyone knows what to do, everyone benefits.  Those who manage the work can rest easy knowing that their team is preventing potential losses.  Those doing the work understand that they are doing important work, not just "busy work."  Stakeholders benefit from a company that constantly and consistently delivers on their promises.  Families benefit from the knowledge that their loved ones are working in safe, reliable environments.

For more information on analytical tools like APM software, come to Meridium Conference 2012 in Jacksonville, FL on April 23rd - 27th.  For information on the conference and to register, click here.