I. Company Heineken
1. Presentation
Heineken International is a Dutch brewery group founded in 1873 by Gerard Adrian Heineken. It is the third largest brewer in the world, with a market share of 8.8% in 2011, behind Anheuser-Busch InBev (18.3%) and SABMiller (9.8%). Since the merger between these two largest brewing empires in the world, in October 2016, Heineken has been the second largest brewer in the world.
The group is present internationally, thanks to its Heineken brand, marketed in more than 170 countries. Heineken International produces or markets approximately 250 brands of beer and cider, including Heineken, Amstel, Desperados, Sol or Tiger…
With an annual beer production of 188.3 million hectoliters in 2015, and global revenues of 20,511 million Euros in 2015, Heineken N.V. is the number one brewer in Europe and one of the largest brewers by volume in the world. The original brewery of Heineken in Amsterdam, closed in 1988, is preserved as a museum called Heineken Experience.
2. Global structure
Heineken extends the company into five territories which are then divided into geographically regional operations. The regions are: Western Europe, Central and Eastern Europe, The Americas, Africa and the Middle East, and Asia Pacific. These territories contain 115 brewing plants in more than 65 countries, brewing local brands besides Heineken brands.
II. Total Productive Maintenance
1. Introduction
Total Productive Maintenance (TPM) is a business process improvement method, developed from the perspective of maintenance management. TPM concentrates on productivity improvement, primarily by way of maximizing the availability of equipment.
To do that, small multidisciplinary teams improve step-by-step the Overall Equipment Effectiveness (OEE) of their machines or production lines.
TPM was first applied by the Japanese company Nippondenso, a supplier to the automotive industry. Later the method was further developed by the Japan Institute for Plant Maintenance. In the European Union, Unilever is one of the biggest propagandists of TPM. This food multinational has used this improvement method for over 15 years, during which it has grown into an overarching process management system.
The smooth organization
Total Productive Maintenance is a suitable method if there is complex (and/or expensive) machinery of which the capacity is insufficient, or if the maintenance costs of those machines are racing up.
Like many other process improvement methods, TPM has grown into a general process management method which can be applied in many situations, even if logistic or human factors should be accounted for. TPM emphasizes the importance of creating a feeling of ‘ownership’ on the shop floor. Therefore, this approach is often associated with strong involvement of the employees. This makes TPM very useful as a starting point for a World Class program, with the possibility to add Lean and Six Sigma tools later. This is also the reason why the acronym TPM is more and more redefined as Total Productive (of Productivity) Management.
TPM is often positioned as a prerequisite for Lean manufacturing. The reason: When your machinery isn't functioning reliable and thus predictable, it is simply not possible to produce just-in-time with little stock between the production steps. Especially when there are factories that have to exchange materials in a network, it is common to apply TPM in the individual factories first, and then add a Lean-program to stimulate the flow in the supply chain.
2. Pillars of TPM
The goal of the management pillars is to improve low OEE-values in a targeted way. TPM embraces at least eight management pillars, or areas of special interest. These are:
i. Continuous (focused) improvement
ii. Autonomous maintenance
iii. Planned (preventive) maintenance
iv. Training (with the aim to standardize the work)
v. Early (equipment) management: maintenance is taken into consideration when new equipment is purchased. Another aim can be the optimal design of a new production line, so that it intrinsically has a high OEE.
vi. Quality management
vii. TPM in the office: the optimization of administrative processes.
viii. Safety and environment
Sometimes ‘the optimal use of employee competences’ is added as ninth pillar. Another rather popular extra pillar is Lean Flow, to introduce Lean manufacturing tools and to prevent local optimization.
3. Principles of TPM
Shared responsibility
Nearly all industrial production processes are carried out with the aid of machines. So it doesn’t sound bad at all to focus on the machinery, if you want to increase the productivity. The basic principle of Total Productive Maintenance (TPM) is, that everyone should start to feel responsible for maintenance. Note, that this also encompasses ‘improvement’ of the machinery. According to the TPM-philosophy, a machine functions worst at the moment it was bought. After that, the goal is to find and eliminate hidden defects. That is the basis for continuous improvement!
TPM is a Japanese method. However, the story of TPM begins in America, where concepts for preventive maintenance were already developed in the forties, among others as part of the Training Within Industry (TWI) program.
TWI was developed during WOII in American factories. The goal was to quickly train new workers, as a replacement for employees who had left as soldiers. TWI introduced for the first time a scientific approach to process improvement. Today, this approach is known as PDCA, or plan-do-check-act, and it became deeply embedded in the Lean approach of Toyota.
Hein Winkelaar1, TPM-manager at PURAC Biochem, thinks this history of preventive maintenance is the reason why Americans nowadays find it sometimes difficult to accept TPM. ‘The Japanese assume a shared striving for improvement in small steps, which they call Kaizen. They say that mapping what has to be improved comes first, next everyone should try to prevent problems themselves. This problem-preventing attitude and shared responsibility is what they call autonomous maintenance. Implementing a formal preventive maintenance programme is considered as the next step. Americans don’t agree. They say that everything starts with preventive maintenance.’
Total employee participation
In the beginning of the sixties, several Japanese companies studied the preventive maintenance methods in the US. That lead to the establishment of the Japanese Institute for Plant Maintenance (JIPM).
The phrase TPM came up for the first time in 1961, inside the Japanese company Nippondenso. At that moment, this supplier to the automotive industry carried out a project named ‘productive maintenance with total employee participation.'
Seiichi Nakajima, employed within the Japan Institite of Plant Maintenance (JIPM), worked out the TPM-ideas in a scientific way. Among others, he developed a phased implementation process, originating from eight management pillars. The first three of these are striving for continuous improvement and introducing autonomous and preventive maintenance.
Raising consciousness
'The implementation of TPM starts with raising the consciousness of hidden losses’, explains Van Kollenburg. ‘One example is a machine failure, or time needed for a machine set-up. Also, if a machine cannot run at full speed, or if it delivers inferior products this is considered as a loss-making activity.’
In a ‘loss-free’ process, the overall equipment effectiveness (OEE) of all machines equals 100%. In that case, every machine always operates at full speed and delivers only products of good quality (see also the box: TPM-jargon).
In reality, the OEE often only is 40-50%. It is the goal of TPM to raise the OEE gradually, per machine, to at least 80%. ‘We start with a pilot-project, in which we measure the OEE of one particular machine. First, we do this simply with pen and paper. This has the advantage that all people concerned will get a feeling for the things that are influencing the OEE.’
Continuous improvement
At the same time, overdue maintenance is carried out. This is part of tidying the work floor, which is called a Total Clean Out. This, followed by the formal implementation of 5S clears the way for implementing the first pillar of TPM: continuous improvement.
'At that moment, the first small and multidisciplinary team is formed, which starts to tackle one specific problem that limits the OEE. The project they carry out is called a small group activity or SGA. In a SGA-team usually there are both machine operators and mechanics, and besides that for example quality inspectors and/or logistic managers. The advantage is that the whole group starts to feel responsible for ‘their’ machine or production line.’
Owner
The team becomes owner of the performance of their machines. This results in a cultural shift. For example, “I operate, you repair”, is replaced by “We, as operator and engineer, share the responsibility for keeping our installation working”
Problems, to be dealt with by the SGA-team, are selected by way of a Pareto-analysis. Then, the team will search for the root cause of the problem. An Ishikawa-diagramme, to map causes and consequences in a fishbone structure, can be helpful. Sometimes the more extended CEDAC-method is used as well, this acronym stands for Cause Effect Diagram with Additional Cards.
'When the SGA-team has detected a root cause of a problem, they will send a proposal for a resolution to their senior management. Included is a cost-benefit analysis. If the solution is approved, it will be implemented. Finally, if will be checked if the OEE is improved.'
Step-by-step
After that, the SGA-team continuous by attacking the next problem, that then limits the OEE the most. This way, the OEE is improved step-by-step.
This endlessly repeated improvement cycle is however only the first step of TPM. When that ‘pillar’ is implemented, seven more management pillars should follow. ‘Pillar number two concerns the introduction of autonomous maintenance. After that, maintenance is not only a task for technicians, but involves everyone, between the bounds of their expertise. For example, operators should inspect their machines regularly, and they can sometimes clean and/or lubricate their equipment themselves.
Pillar three refers to making a schedule for preventive (and sometimes also predictive) maintenance. Pillar four entails a training programme, to make all employees familiar with the TPM-principles and continuous improvement, not only in general bit also in relation to their own place of work.
The fifth pillar, early management, deals with the development of new production processes and/or the purchase of new machines. In the latter case, during the selection process, the amount and method of maintenance are already taken into consideration.
‘I saw once that a new machine was installed with the door facing the wall. To prevent such things, early management is important. Sometimes it can for example be handy if a machine has transparent panels, this simplifies the carrying out of inspection rounds.’
Pillars
Van Kollenburg thinks that the first four or five TPM-pillars are the most important. ‘However, I am not so charmed by thinking in pillars. I think that is one of the weakest points of TPM. The borders between the pillars are vague. Essentially, TPM should form a whole. Then it is for example possible that a SGA improvement-team discovers that it is necessary to raise the frequency of preventive maintenance.’
‘Companies with a lot of machines and or complex process control systems cannot leave out TPM’, Van Kollenburg concludes. ‘However, it is important to prevent local optimization. Therefore, I advise to supplement TPM with a logistic improvement method like Lean manufacturing.’
Focus
To give the process improvement with TPM focus, strategy defining methods like Hoshin Kanri are often applied, for example by Heineken. First, it is then determined which losses should be reduced in a factory during the next year. Next, these priorities are translated into Key Performance Indicators (KPI's), first for the middle management level, and later for the operational level. This way, you get a cascade of KPI's. The idea is that finally, everybody knows how he or she can personally contribute to fulfill the improvement agenda!
III. TPM Program of Heineken
The Total Productive Maintenance Program (TPM) of Heineken started in 2003. Thanks to this program, all breweries produce increasingly more efficient and with fewer losses.
The factory in ‘s Hertogenbosch in the Netherlands is one of the best production sites, concerning TPM. Here, in recent years, the Overall Equipment Effectiveness of the packaging lines rose from 47 to 72%. In addition, productivity and quality are better then ever before! TPM-manager Age Posthuma explains this, by stressing three success factors: deployment, audits, and training.
Of course, additional improvement is always possible. ‘This can be achieved by connecting our external processes better with the operations within the brewery’, says Posthuma. ‘Examples of those external activities are supply chain processes and the introduction of new machines and products.’
The fifty years old brewery of Heineken in Den Bosch in the Netherlands, is located at no more than a fifteen minutes’ walk from the city centre. It has the appearance of a couple of huge green shoe boxes. This production site received in 2009, as the first brewery of Heineken, an international accreditation from the Japan Institute of Plant Maintenance for its Total Productive Maintenance (TPM) program.
TPM embraces at least eight management pillars, as mentioned above. Within Heineken in Den Bosch there is a 9th pillar: internal logistics. In addition, Heineken places above all pillars a coordinating management pillar or cross bar, called focused improvement. Within this cross bar, the top-level improvement priorities are determined, which give the TPM program direction. Via deployment, higher level goals are connected with lower level goals within specific pillars. In the end this cascade branches off into targets for Key Performance Indicators at the shop floor.
Focused improvement
To manage its improvement program, the brewery uses the so-called management pillars of TPM (see the box above). Above these pillars lies a cross bar, called focused improvement. ‘Each year, the managers within this pillar arrange an improvement agenda with eight priorities. These are the main losses that will be reduced in the plant during that year.’
These eight priorities are converted into Key Performance Indicators (KPI’s), first for the middle management level, and later for the operational level. ‘That way, you get a cascade of KPI’s’, explains Posthuma. ‘The idea is that finally, everybody knows how he or she can personally contribute to fulfill the improvement agenda.’
Extract loss
Typical examples of annual goals are the improvement of the efficiency of the can production lines, the reduction of the energy consumption, and minimizing the extract loss, the quantity of beer that is spilled during production. During the last years, this percentage fell significantly in the brewery at Den Bosch, and loss of malt was reduced by 27%.
Posthuma explains how a goal like ‘reduce extract loss by X%” is converted to target values for KPI’s on the floor. ‘First, starting from Focused Improvement, it is examined which TPM-pillars can contribute most to the improvement planned. In this case, a lot of avoidable losses could be attributed to the pillar Quality Management.’
Then, in the next step, the management team of that pillar will map where the most improvement is possible. ‘Material balances are used to do that. You could see that as a variant of Value Stream Mapping, applied by chemical process engineers.’
Clear beer
One of the improvement points identified in this case was the loss around the clear beer cellar. From this cellar, the beer is distributed to several bottling and packaging lines. ‘To solve such an issue, a multidisciplinary team is formed. In this case, the team consisted of a technician, a maintenance specialist, and several operators. Such a team tries to solve the problem assigned to them within a period of six to twelve weeks.’
Here, the team started by monitoring for a period of two months all in- and outgoing streams of water, cleaning fluid, clear beer, surplus beer, and waste. This lead to the following conclusions:
During the flushing-process, before sending beer to the packaging lines, to much beer is directed towards the sewer.
Later, when feeding of a packaging line is stopped, to much beer is directed to a vessel with residual beer and/or to the sewer.
‘By applying the asking-five-times-why-technique, the team started to search for the root causes of this waste. Finally, they found two countermeasures. First, standard conditions for directing beer to the sewer were changed. Second, flow meters and conductivity sensors were put in place. Since then, it became possible to steer the amount of beer discharged to the sewer by volume, instead of by time. As a result, our annual loss of beer was reduced with an amount which equals 1.6 million glasses!’
Kaizen
The program around the improvement teams is managed in a top-down way. This raises the question if there is also room for bottom-up initiatives. Fact is, that in Lean management it is often stressed that it is important that everybody, everyday contributes to the improvements!
‘We agree with that', Posthuma reacts. 'Kaizen we see as a our second axis of improvement, besides the cascade of KPI’s, coupled to the annual goals. Kaizen is however not done by improvement project teams, but by our machine teams. These are groups of operators who own a certain processing step.’
With Kaizen, focus is first on restoring basic conditions. This means taking care that a machine will function again as new or even better. In addition, attention is given to autonomous maintenance, this means that operators do small maintenance jobs like cleaning themselves. ‘Today, the focus of Kaizen has shifted to continuous improvement. To make that possible, each machine team locally manages a deployment-resembling process. This means: the best improvement suggestions coming from the field are selected.’
Besides every machine, there is an improvement board. ‘This is a kind of cockpit on which actual performances can be read out, such as efficiency data and lubrication times. A part of those data is collected automatically, by our Manufacturing Execution System.’
Once in every three months, the machine team conducts a Pareto-analysis, to identify which machine failures occurred most frequently. ‘To determine which machine parts are the most inclined to failure, sometimes a machine is imaginary dismantled. After that, the team will search for counter measures, to prevent problems with those components.’
Discipline
Posthuma has seen the idea of Kaizen become alive in the working place. ‘What we all want is to improve our own performance and make our work more fun. Operators are now engaged themselves with improvement projects, instead of only following orders. Sometimes the result of rather simple adjustments can be astounding, like an efficiency improvement of 1% at a packaging line.’
Westerners however think and act differently than Japanese people. ‘Therefore, it is not possible to completely copy the way how Toyota applies Kaizen’, thinks Posthuma. ‘For example, in the Netherlands, passengers entering trains often block the stream of passengers who want to get out. In Japan, you see something completely different. There, passengers are neatly waiting in blocks, until they can enter. What you can learn from this, is that disciplinary behaviour is not in our genes. Therefore, we need to give extra focus to this aspect in our factories, because discipline is very important to hold on to the improvements already made.’
Bottlenecks
Registration of the Overall Equipment Effectiveness (OEE) is a common tool to improve the efficiency of production steps within Heineken. Sometimes, it is said that with OEE-measurements there is a risk that this will lead to local optimization. Posthuma is not afraid that this will happen: ‘A research group from the university of Eindhoven developed software for us, with which we for example can simulate the behaviour of packaging lines. That way, we identify the bottlenecks in the system. Those are the spots where you should focus on, while improving the OEE.’
So OEE-measurements are not the problem, but there are other things which could be done better within the brewery, such as more alignment with external processes. ‘During the last six years, the OEE of our packaging lines rose from 47% to 72%. To raise it further, it will be needed to look at the connection with processes outside our brewery, such as the introduction of new products or machines.’
There is also room for improvement by aligning the supply chain. ‘Although we internally have a special TPM-pillar for logistic optimization, we are not allowed to change inventory levels or batch sizes ourselves. Every week we receive our production plan, but besides that we regularly get rush orders which disturb the flow. This is caused to a large extent by the fact that we are a very complex brewery. We produce as many as 850 stock keeping units, therefore we often serve as capacity buffer within Heineken.’
Early Management
Speaking of better alignment: In the years to come, Posthuma also wants to improve the power of Early Management. Roughly said, this means that a new machine is selected and installed in such a way, that the OEE of it is immediately as high as possible. So, change-overs should be possible easy, and prior to installation autonomous and preventive maintenance programs are already developed.
‘Suppose that we need a new packaging machine. In that case, we hand over the technical requirements to a central procurement organization, outside Den Bosch. I don’t want to say that these purchasers don’t listen to our engineers and operators, but they don’t completely follow the early management step-by-step plan, as prescribed by TPM. As a result, we not always speak the same language.’
Recently a new multipacket was bought, installed and put into operation. ‘With this new machine, it is possible to use cardboard packaging material of different suppliers, which makes us more flexible. Initially this advantage was however undermined because the change-over time was as much as 180 minutes. Later, we tackled that problem, and the change over time was reduced to 80 minutes. I think that correctly applying early management could have prevented the suboptimal operation period.’
Audits
As the example above shows, there always remains room for further improvement! Nevertheless, the brewery in Den Bosch nowadays is seen as leading within Heineken, concerning the application of TPM.
Besides the already mentioned deployment method, Posthuma gives two other reasons for that: the audits and the training program. ‘Audits we conduct at different levels. Our brewery is divided into zones, which are all allocated to management duo’s. It forces us all to visit the working place regularly. A go to the gemba or shop floor, as they say in Japan.’
The audits don’t serve to breathe down to the neck of employees. The idea is to improve the contact between management and operations. ‘Therefore, also the improvement teams and the machine teams are audited regularly’.
Training
Finally, Posthuma points to the important contribution of Heineken's training program. ‘We have training modules for operators and engineers, tailored to their own situation. The technical teaching was developed in cooperation with the Dutch training institute ROVC, and we added TPM-modules ourselves. The advantage of the resulting mix is that the training now completely fits with daily practice. Exercises can be done at the working place of the operator or engineer.’
Soon, the team leaders will receive a special complementary training. ‘Some of our team leaders used to be operators, they have closely witnessed the development of TPM within Heineken. Other team leaders however came from other companies. These people usually have sufficient management capabilities. However, they do not always have enough knowledge of TPM and technology, needed to ask the right questions to trigger improvement.’