Reducing refinery downtime through pride-building

Reducing refinery downtime through pride-building

Situation

In many instances of working with clients, we have seen evidence of the benefits of a pride-building capability. The manufacturing division of a major company significantly expanding its production needed to improve the reliability of its refineries, and viewed the performance of its front line – where the majority of work was done – as a key factor for success.

Prior formal efforts to change the mind-set and behaviour of the frontline workers had been ineffective, and recent ownership changes at some of the sites had created a change-resistant culture. In addition, the highly process-orientated management team struggled to get traction in an intensely local operating environment.

How we helped

The division launched an investigation into the large amounts of unscheduled downtime in its downstream operations. The findings were somewhat startling: 87 per cent of unscheduled downtime was caused by equipment failure, and – not coincidentally – the company lacked adequate policies and procedures to identify equipment problems. For example, managers had no policy to walk the floor regularly to identify current and potential problems; employees were not incentivised to report all potential threats; and communication between operations and maintenance was poor. Making matters worse, employees believed that problems would go unaddressed, even if they were reported.

In response, the company launched a program to identify frontline pride builders, and tasked them to work together to identify the behaviours that would improve performance. They were also asked to find a way to integrate these behaviours into the daily actions of frontline workers so that they could use them as part of their routine workflow.

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Exhibit 1
Developing a pride-building capability is worth the effort. As previous Strategy& analysis has shown, pride in one’s work is a great motivator – even greater than money. The pride-building capability bridges the gap between business strategy and execution by aligning formal organisational levers, such as capabilities, roles, and performance management, with informal levers such as motivation networks and cultural norms, thus translating official directives into on-the-ground behaviours.

Results

Among other recommendations, this advisory council identified better communication and coordination between operations and craft as being vital to better equipment maintenance. With this in mind, the council proposed joint morning meetings to prioritise work, joint scheduling, and joint resource allocation; introduced a new protocol for craft to conduct preliminary investigations with operators in the field; and suggested mechanisms for the two functions to review the previous day’s work.

Based on these recommendations, the company rolled out a pilot program at five of its sites, and the results were dramatic. There was a 12 percent decrease in schedule-breaking work (e.g., emergency tickets), which made craft workers more productive; there was a 38 percent drop in average work order costs, thanks in part to a 76 percent drop in overtime; and there was a 47 percent reduction in backlog.