December 1, 2014 by AP-Networks 1 Comment When it comes to turnarounds, competitive performance stems not from the depth of resources an organization can allocate to the event, but from how effective organizations are in preparing for the event. There is typically a solid general understanding of the value of planning in the business unit, and most organizations today follow a documented turnaround preparation process. Having such an explicit process by itself produces significant benefits to the organization, and is essential for transitioning from a culture of problem-driven firefighting to process-oriented operation. If combined with the right set of KPIs, this approach compliments the recognized continuous improvement model that is currently used widely by businesses managing their routine operational, technical, commercial, and financial activities. But developing and effectively utilizing process-oriented KPIs is still a considerable challenge for many sites, preventing them from achieving the full potential of their process. Unlike turnaround event measures, the choice of preparation indicators works better if driven not by the standard HSE, cost and schedule, quality, and operability set of measures. Those are post-factum measures of overall turnaround success. While they’re great for looking back, they don’t provide an effective way to prepare. So what are some of the KPIs that can be used to manage a turnaround preparation process? Process Adherence The first KPI category to focus on relates to how well an organization follows a turnaround preparation process. Examples include a completion KPI indicating how preparation activities are progressed (actual vs. planned curve), and a process compliance KPI indicating how closely the process has followed the agreed upon plan (percentage of activities completed on time). Scope Scope collection and management represents another critical area that, as observed in the AP-Networks Turnaround Database, can make or break a turnaround’s success. Scope KPIs can include scope sign-off, indicating how successful the organization is in the timely collection of a detailed, “plannable” scope list (percentage of scope items in the detailed planning phase); scope creep, showing how well scope is maintained throughout the preparation and execution periods (scope growth percentage by count and by value); and scope control compliance, indicating how effective the scope control process is (added scope breakdown by area, reason for addition, and percent rejected—both by count and by value). Risk AP-Networks and AP-Canada have observed that a systematic, action-focused approach to risk management significantly improves the likelihood of turnaround success. Risks to turnaround success should be identified early in the preparation process and managed proactively, with an appropriate strategy selected for each risk. If risks are managed properly, the overall total Risk Index for the event should decline over time as individual risks are mitigated, or appropriate contingency plans are developed. This Risk Index can be used as one of the turnaround preparation KPIs. Capital For turnarounds that have an integrated capital project execution component, another critical success factor is strong cooperation between the turnaround organization and the capital and process/technical functions. AP-Networks and AP-Canada have found that the timely issue of engineering planning packages to the turnaround team is critical for turnaround success. Therefore, the percentage of engineered planning packages that have reached the Issued for Construction (IFC) milestone is another important KPI to track. Job Packages When discussing the organization’s ability to effectively track turnaround preparation status, it’s useful to report regularly on the status of job packages. Areas to focus on include how many packages are in each phase of development; planning, ordering, receiving, bagging and tagging necessary materials; job walk downs; package reviews and sign offs; and final submittals to contractors (allowing enough time for field personnel to get acquainted with the work provides a foundation for strong execution performance). Properly selected and utilized KPIs, such as the ones detailed above, facilitate the work of the turnaround planning and steering teams, and drive their focus from simple activity management to performance improvement. These KPIs also aid turnaround leadership with the timely identification of potential problem areas, and promote root cause analysis and subsequent action. Achieving predictable, competitive turnaround performance is more challenging now than ever before in the process industry, but by combining these preparation KPIs with aggressive, achievable turnaround performance targets, organizations can consistently achieve top quartile performance. Authored by Andrey Chestnykh – Senior Consultant | Asset Performance Canada (AP-Canada) To find out when new posts go live, follow AP-Networks on LinkedIn. And follow AP-Canada on LinkedIn here.