Archive | August, 2008

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August 1, 2008
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Efficiency & Reliability: Real Cost-Saving Strategies

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Tim Owens, CMRP, President and CEO, PdMA Corporation

Almost every industry in America today is experiencing higher costs—energy, raw materials, labor, health care, shipping— you name it. In previous years, industry typically could pass these costs on to consumers, but that’s just not the case today. In addition to being concerned about the housing crisis, rising inflation and growing unemployment, American consumers are facing some of the same cost increases as industry. Rather than pay more for things, they’re likely to just not buy at all.

So where does industry turn to offset rising costs? Many of our past solutions simply may not work anymore. Odds are that suppliers are already providing raw materials at razor-thin margins. Most companies maintain a lean payroll, and employees are only capable of providing so much “discretionary effort” before they begin to balk.

Fortunately, there is a ray of hope. Many industries are finding significant savings through a rigorous analysis of their electrical and mechanical systems. These savings come in two main areas:

  1. Reliability—or how much downtime a machine experiences due to breakdowns; and
  2. Efficiency—or how much output a motor produces for a given input of energy.

Think about it. While companies can’t necessarily control the cost of their inputs, they can increase plant reliability and availability without increasing maintenance costs. This is accomplished by implementing sound maintenance and reliability strategies, including a strong maintenance planning and scheduling program, applying predictive maintenance technologies and performing PM optimization.

Within your own company, in situations where old, failure-prone equipment must be replaced, consider involving engineering and maintenance personnel in the planning early on, preferably in the design phase. Additionally, look at life-cycle versus installed costs. The upfront cost usually will be higher, but in the long-run, lower life-cycle costs can save businesses a tremendous amount of money and headaches.

Similarly, upgrading low-efficiency electric motors with premium or high-efficiency motors will quickly pay for itself in reduced energy consumption. For instance, a 30-year-old electric motor is likely to be less energy-efficient than a new one due to advances in engineering and design. Still, efficiency is not just about replacing old, wasteful motors—it’s also about properly matching a motor to its application.

While an undersized motor will strain to do its job, run hotter, consume excess energy and fail prematurely, an oversized motor will likewise run inefficiently and waste energy. (Think of the old adage about using a hammer to swat flies!) For example, replacing an older, oversized 500 hp motor that operates at just 56% capacity with a newer, more efficient 300 hp model working at 93% capacity can save as much as $10,400 a year in energy costs. If the cost to buy and swap out the motor is $14,000, the total capital investment can be recouped in just 1.3 years.

Businesses today are looking for any edge to remain competitive. If they can’t increase revenues in a sluggish marketplace, they can raise their profit margins by cutting costs. By implementing proper maintenance and reliability strategies, as well as performing energy-efficiency assessments, companies are finding the competitive edge they need to compete in a world of higher prices—and they’re doing it on an increasingly successful global scale. MT

This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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138

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August 1, 2008
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Industry Outlook: Going Forward, It’s All About Energy

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David C. Orlowski, Founder & CEO, Inpro/Seal Company

The lead items coming out of almost all mainstream news outlets these days seem to focus on the price of gasoline hovering in the $4.00-per-gallon range. It’s not as though the regular drivers among us need to be reminded of that depressing fact of life. The news media, though, is not the only group putting a harsh spotlight on the issue. Skyrocketing energy costs, regardless of the fuel, have become an embarrassing political football in this election year.

Forget the press and the politicians. How to mitigate a global energy crisis is a matter of deep trepidation to everyone. While we see plenty of hope on the horizon, we know it won’t come fast.

Upstream production of hydrocarbons and downstream refi nery upgrades are attempting (and doing a pretty good job) to keep up with worldwide demand. Both old and new sources of “black gold,” including Canada’s tar sands and shale oil deposits in the Western U.S., are undergoing extensive development.

Our old friends coal and natural gas also are being explored and leveraged to the hilt. Nuclear energy, once shunned, is again being considered for major expansion. Biofuels are still in the mix, with wind power and solar initiatives fi lling in the larger picture.

Unfortunately, to fully harness the many fossil and renewable energy sources we have and/or will have is expected to take many years. That’s why conservation of our available energy resources is so crucial now. Being successful at this will require a general overhaul of the way industry thinks.

For example, while the initial cost of a pump or motor is just a minor part—3% to 4%—of the total lifetime cost of the equipment’s ownership, the energy required to run these units is major. Recognizing their customer’s needs, manufacturers have made great strides in providing energy-effi cient products. Today, pumps are being designed to operate in their best effi ciency range for reasons of both hydraulic balance and improved power consumption. Motors are now capable of operating at electrical effi ciencies in the high 90% range. Still, it’s up to the end-user to specify energy-effi cient products and capture the benefi ts they offer.

Our company also is doing its part to conserve energy and promote the reliability of rotating equipment, within our own operations and those of our customers. The benefi ts of energy conservation are immediate and can be accomplished by systematically eliminating energy-consumptive components and substituting non-energy consumptive devices.

Consider these statistics. Every noncontacting bearing isolator that supplants a contact bearing protection seal, be it a lip seal or face seal, not only will protect the bearing environment, it will conserve an average of 147 watts of power. Furthermore, the effective life of a contact seal is relatively short and it has a 100% failure rate, which is not the case with non-contact bearing isolators. This year, we project that we will move 700,000 non-contact bearing isolators through the marketplace. The power these devices will help to conserve is equal to what 70 wind turbine generators would produce.

We, like many other energy-conscious manufacturers, are ready, able and committed to increasing our production when the need presents itself. To our way of thinking, all of us—suppliers and end-users alike—have an opportunity to help solve the energy crisis. It begins right now. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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163

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August 1, 2008
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Industry Outlook: Controlling Your Rising Energy Costs

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John A. McFarland, Chairman & CEO, Baldor Electric Company

As I write this article in early July, I’ve just been notified that one of our principal electricity providers will be increasing its price by 25%. If you haven’t looked at your electricity bill lately and compared it to the price you were paying a year or two years ago, you will be shocked! Electricity prices have been rising and many experts forecast that these increases will continue.

Electricity costs sometimes are overlooked when developing productivity and cost reduction plans. Often the person who pays the electricity bill and understands its impact on the company’s results is not the person who buys the products that consume electricity and create this cost. In many companies, Manufacturing Engineering purchases new equipment, the Maintenance Department purchases replacement components (such as motors) and the Finance Department pays the electricity bill. Understanding what makes up your electricity bill and addressing those components when a purchasing decision is made can help to control rising energy costs at your facility.

According to the United States Department of Energy, industrial electric motors make up about 60% of a typical manufacturing company’s electricity bill—and up to about 90% of a mining company’s electricity bill. Electric motors have different efficiency ratings, just like automobiles. Your company can buy a 10 horsepower motor rated 89.5% efficient or a NEMA Premium® efficient motor at 92.4%. The difference in price between the motors is about 30% and that premium usually will be earned back in two years or less, depending on your power cost.

Since motors are generally very reliable, often lasting 15 or 20 years, it’s important to make the right decision up front when buying motordriven equipment or replacing a motor that has failed. Many manufacturing companies, such as ours, have thousands of motors in operation and spend millions of dollars on electricity to run them.

There are several things a company can do to control the cost of running electric motors. First, don’t oversize the motor for the application. Most motors have their highest efficiency near their rated load point. Over-sizing motors sometimes causes them to operate less efficiently and more expensively.

Select a NEMA Premium high efficiency motor when a motor fails. Often, motors that fail are 20 years old or older. Motors manufactured 20 years ago were not as efficient as those made today. When putting motors on variable torque applications, such as fans and pumps, consider using an inverter to tune the motor to the required output of the fan or pump the motor is running. In some cases, this can save as much as 40% on energy consumption.

Remember that single phase motors are not as efficient as 3-phase motors. Always check to see if the single-phase motor can be replaced by a 3-phase motor.

Lastly, when purchasing new equipment, only specify high-efficiency motors. They may cost a little more on the front end, but payback is quick and the energy savings will last the lifetime of the motor.

In industry today, we face many challenges including the high cost of energy and foreign competition. Your electricity bill is part of your cost and it is a cost that can be controlled in part by using high-efficiency motors and drives. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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194

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August 1, 2008
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Industry Outlook: Taking The Lead To Address Water Issues

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Gretchen McClain, President, ITT Fluid Technology, Senior Vice President, ITT Corporation

Our mission at ITT Fluid Technology is to provide safe water and sanitation for everyone—globally. That’s both our goal and our passion. At ITT, we take great pride in our role as a thought leader in the water industry.

For more than 30 years, we have been instrumental in setting the standard for innovation, performance and reliability around the world. We bring extraordinary focus to the job of running our business, yet we never let ourselves lose sight of the larger perspective. Our products and services directly touch millions of customers and end-users—but our actions reach millions more people all over the world. From nanofi ltration membrane technology to low-cost, easy-to-use portable water treatment systems, ITT products play a central role in preserving the earth’s most precious resource and increasing access to safe water supplies.

It’s no secret that the world is facing unprecedented water challenges brought on by population growth, urbanization and shrinking fresh water supplies. Experts agree that it will take several trillion dollars of investments in water infrastructure over the next two decades to address this urgent issue. As the global leader in water equipment, we are well-positioned to serve this market with pumps, valves and treatment technologies.

While water scarcity truly is a global issue, its immediate impact is in developing countries. As part of our emerging market strategy, ITT is investing in new world-class manufacturing and service facilities, unifying and expanding our sales force and launching research and development centers in India and China.

We are committed to providing our customers in more than 130 countries with innovative technologies that meet their needs. This includes the supplying of next-generation products such as predictive monitoring controls, wear-resistant pumps and energy-effi cient disinfection systems that reduce operating and maintenance costs.

As a responsible citizen, we want to grow our company while also contributing to the greater good. In short, we want the world to be a better place because we are a part of it.

Corporate citizenship extends into many areas: environmental stewardship, workplace safety, product responsibility, “green” technologies, processes and facilities and philanthropy. At ITT, we are focused on doing a better job in all of these areas and we are committed to being a company that lives up to our responsibilities as a thought leader—and as a good global neighbor.

Our efforts have not gone unnoticed. ITT has been ranked in the top 10 on CRO magazine’s “100 Best Corporate Citizens” list. This annual ranking evaluated more than 1100 large U.S. public companies and highlighted ITT for embracing high standards combined with strong fi nancial performance and responsible practices on environmental and social issues.

In conclusion, there’s no question that there are challenges ahead for our world’s water. There are some who believe that increased need, stressed supplies, pollution and geopolitics are clouding the future. At ITT we have a different outlook. We believe that our use—and reuse—of this precious resource will help defi ne the future of humanity. We are excited to be a part of the solution to this challenge. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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156

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August 1, 2008
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Industry Outlook: Education: It's Our True Long-Term Crisis

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Marc Marini, General Manager, IOtech

The exploding commodities market—led by oil—is surely a leading candidate for the crisis of the year. As a country, we will weather this storm. While it won’t be easy, conservation of resources from existing sources and investment in the expansion of others will see us through.

Conservation can come in many forms, with the most obvious being a cutback on use, be it opening the windows and turning off the air conditioner, working from home one day a week or parking the SUV in favor of a more efficient vehicle. A less obvious and longer-term form of conservation takes root in process improvement.

Our business, data acquisition for measurement and control, allows people to measure their processes and improve them. One example of this is Internet-based machine vibration monitoring, allowing remote predictive, rather than on-site preventive, maintenance. By bringing the data to the expert, unnecessary travel to the source of the data can be avoided. Travel only occurs when the expert is needed. In addition, moving from preventive maintenance (fixing it if it needs it or not) to predictive maintenance (fixing it just-in-time) reduces or eliminates unnecessary downtime and repair.

Crises like rapidly rising oil prices have frontpage status because of their immediate impact on our everyday life. Unfortunately, the true longterm crisis we face doesn’t always show up on the front page—nor does it elicit the same emotional or political response. That potentially more signifi- cant catastrophe is the United States becoming irrelevant on the world stage by losing our leadership in innovation and technology.

How do we avert such a disaster? What strategies should we employ to forestall what could become the end of the American age? The answer is more technical, engineering and scientific education.

This is not about spending more money on education, but rather about many of us sharing the passion that drove us to become engineers and scientists. We need to help more of our children to find the same excitement and joy in science and engineering that many of us have. The minds of our future are important and should not be wasted.

What is greater, the probability of a child becoming a sports superstar or scientist? I can only wonder which career occupies more childhood dreams?

Programs like FIRST Lego League can plant dreams of becoming an engineer in our children, much like the Apollo missions did for countless of today’s adults decades ago. Through robotics, FIRST introduces youngsters to mechanical, electrical and structural engineering. Our company supports these types of initiatives enthusiastically—other companies need to make a similar effort to introduce the young to the excitement of technology.

Conservation certainly can help in husbanding our resources, and many argue for the expanded use of our natural resources, from biofuels to wind, as a solution to our insatiable appetite for energy. As we clamor for the augmentation of oil, though, we should demand and readily participate in the development of future engineers and scientists. After all, our nation’s future intellect is our most abundant and precious resource. The true solution to our short-term problem lies in solving this long-term challenge, for who else will innovate us out of our dilemma?

Get involved today. Support programs like FIRST. Encourage learning. Share your passion. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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197

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August 1, 2008
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Industry Outlook: Proactive Maintenance Helps Reduce Energy Costs

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Barbara Hulit, President, Fluke Corporation

In the midst of all the talk about being green and environmental impacts of industrial operations, one fact seems to get lost—reducing energy consumption saves you money. That fact translates to a lot of other benefits, including competitive advantage, reduced MRO over time, increased ability to plan maintenance expenditures and, thus, forecast budgets, etc.

With rare exception, EVERY industrial facility can reduce its energy consumption. Why, then, don’t more do it? When energy costs were low, it wasn’t a priority. Now it’s making a lot more sense. But, where do you start? Fluke emphasizes two approaches.

  1. Practice proactive, rather than reactive, maintenance. This will keep equipment operating at optimal efficiency and require less energy.
  2. Conduct regular energy audits to map energy consumption patterns and implement new practices to reduce usage.

This magazine has long sung the praises of proactive maintenance—using readily available tools to identify and abate equipment degradation. While there are startup costs to this strategy over the run-to-fail method, the savings accrue relatively quickly, typically within 18 months.

So, how much can you save by adopting proactive maintenance practices? Consider that reactive maintenance due to labor, equipment replacement and downtime costs three to five times as much as proactive maintenance. Then, add 20% more savings from reduced energy use. That’s because poorly-maintained equipment requires more energy to function. Think about worn bearings or misaligned shafts or highresistance connections.

When moving to proactive maintenance, keep it simple at the outset. Combine your knowledge of key equipment with manufacturer-recommended maintenance cycles to create a maintenance schedule, and then inspect-as-you-go. Newly-affordable tools like thermal imagers make it possible for maintenance staff to quickly survey plant equipment on a regular basis and identify many types of equipment degradation early on.

Conducting an energy audit also can help you prioritize equipment for your maintenance schedule. Start with an energy study and then target the biggest energy culprits in manufacturing facilities—inefficient equipment and the HVAC system.

An energy consumption study requires a power logger that can monitor voltage and current simultaneously and measure power factor. If the power factor at your facility is too low, it means you are not managing your power effectively, and the utility will charge a higher rate. Once you log energy consumption over time, for each part of the plant you’ll see what system aspects are consuming energy when. You then can rebalance loads, schedule for off-peak hours or upgrade equipment.

When evaluating your equipment, consider these points. Have you installed newer-model variable frequency drives where possible? Have your circuits and systems been thermally scanned? If not, you may not be aware of overloaded or imbalanced circuits, loose connections, overheating motors, malfunctioning steam traps and a host of other conditions that could signal inefficient use of energy.

The overhead cost of the HVAC system is an afterthought to most facilities. But, when is the HVAC system cycling on? Has the equipment been updated? Chillers often use up to 30% more energy than required as a result of system inefficiencies. Neglected boilers and AC units also become less efficient over time.

The fact that proactive maintenance is “green” may be nice, but beyond the “color” are the economics. They just make sense. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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August 1, 2008
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Industry Outlook: CAPEX/OPEX Evolution Across The Process Industry

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Patrick Holcomb, Executive Vice President, Process, Power & Marine, Intergraph Corporation

Tremendous process capacity is coming online in the next five years in the oil, gas and petrochemical segments. Capital spending on these facilities has been ramping up from $100 billion a year in 2003 to well over $200 billion per year in 2008.

Owners are expanding existing facilities and building new capacity at record levels to meet growing demands in the increasingly competitive global market. This must be done with finite material and labor resources and tight capital expenditure (CAPEX) budgets. Expansions and new construction also must be done quickly to meet exacting schedules that are established to minimize time-to-market and maximize time-inmarket ROI. After startup, owners are constantly challenged to achieve safe, sustainable production at the lowest possible operating costs (OPEX)— despite higher-than-ever product demand and competitive pressures.

One challenge that has historically plagued the process industry is the conflict in incentive systems and procedures between the CAPEX and OPEX segments of the business. There has been no major innovation in CAPEX strategies to reduce subsequent OPEX since standardization on automated digital control systems (DCS) and general acceptance to specify integrated heat recovery systems.

In general, CAPEX personnel are still strongly incented to achieve safe, on-budget and on-time startup with relatively little post-startup interest. However, the good news is that there have been some evolutionary improvements in CAPEX strategy and new technologies to enhance operations and maintenance efficiency.

More and more owner operators (O/Os) are involving operations and maintenance personnel earlier in the capital process than a decade ago. With 3D modeling a standard requirement on large projects and advanced enterprise engineering software available as a repository for plant data from its inception, many O/Os take the opportunity to conduct more thorough operability and maintainability reviews with their operations and maintenance teams and the CAPEX/engineer’s staff. This allows maintenance and operations staff to catch more critical issues sooner in the process, leading to time and money savings over the life of the plant.

Many O/Os are becoming more involved in the planning for project information handover. In the past, handover was the delivery of a pickup truck full of paper drawings. Now, O/Os are increasingly dictating very specific electronic handover steps—to use as project milestones and to ensure more richly populated maintenance systems. New enterprise engineering data management solutions coupled with portal technologies and service-oriented architecture (SOA) further enable better access to technical information post-startup without the burden of actually using the underlying authoring application. This means that O/Os can be more aggressive about their plans for managing their engineering design basis and simultaneously realizing better solutions for operations and maintenance.

Another significant evolutionary trend is that reliability-centered maintenance is starting to be considered in the capital project phase. While this is by no means standardized, more capital projects than ever before are demanding more maintenance and reliability plans as part of the project.

In conclusion, though the capital phase still is run largely on objectives of ensuring a safe, on-budget, on-time startup at stated capacity, there are increasing considerations made for long-term capacity assurance and OPEX after the project startup crews are gone. By factoring in OPEX during plant conceptualization and managing enterprise engineering design basis, O/Os can realize improved and sustained savings over the full life cycle of their plant investment. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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August 1, 2008
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Industry Outlook: Delivering More Than Just Great Product

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Luis Guimarães, General Manager, Americas, Shell Lubricants

Sharp increases in demand and price for crude oil have resulted in higher costs of materials, energy and other maintenance, repair and operations supplies. Amidst these challenges lie opportunities, even in bear economies—tough times often force companies to think more critically about products and solutions.

A recent Kline & Company study of competitor ranking revealed that Shell retained its position as the global lubricants leader. We believe our global No. 1 position is based first and foremost on our full portfolio of top-quality products. Success, though, cannot rest solely on the shoulders of great products. This is especially true for lubricants.

The value of a lubricants company goes far beyond its products. Good lubricant suppliers work with their customers to perform a complete assessment of a plant’s applications, processes and procedures in an effort to highlight areas where improvements can ultimately result in reduction of the overall cost of operation. At Shell, we combine our products with the capability to deliver first-class lubricants solutions to customers. As critical as R&D is for the creation of the lubricants, so, too, is the preparedness of our staff to be able to provide the best solutions to customers.

When choosing a lubricant, companies first must understand what demands and specific qualities are required for the application. With roughly 26,000 applications for lubricants in the United States, it is understandable why some companies face challenges when identifying the most efficient and cost-effective products for their applications. Most industrial customers operate under the misconception that lubes are commodity products. Consequently, when faced with hard times, companies often explore cheaper alternatives. Lubrication, however, is an area where companies should seek to optimize their investment instead of turning to lowerquality alternatives.

The qualities and performance characteristics of lubricants can vary greatly—even among those that all meet a minimum performance specification. The least expensive lubricant for a particular application does not necessarily mean it is the most cost-efficient lubricant. Equipment failures, replacement costs and the labor that is required to replace failed components may be secondary to the costs encountered by resulting production loss.

Only by evaluating the entire life cycle will customers recognize the value of using highquality lubricants such as synthetics. Benefits of using synthetic lubricants—which include temperature reduction, energy efficiency (in selected applications) and extended service life—can have a big impact on a plant’s production output and total operating cost.

Though the upfront cost initially can be higher, investment in quality lubricants can help manage maintenance costs.

At Shell, we strongly believe that the role of a lubricants company is not to simply provide product, but to arm customers with the information to make informed decisions. By helping customers understand the total cost of ownership rather than pure lubricant cost, we empower organizations to choose the most cost-efficient solutions for their businesses. MT


This article is part of Maintenance Technology’s 2008 Industry Outlook, the annual executive roundtable. Columns from each of the 14 thought leaders who participated can be found at the following link: http://www.mt-online.com/article/0808-industry-outlook

Maintenance Technology is sent free to qualified subscribers each month. Visit www.subscribeMT.com to fill out an online application for your free one-year subscription today. By doing so, you will join more than 50,000 technical and business professionals who already receive Maintenance Technology magazine, your source for capacity assurance solutions.

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