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4 Reasons Why Regulated Industries Need To Invest In APM

Failure to meet regulatory reporting requirements carries a direct impact on profitability that can range from a fine or penalty, to outright invalidation of the product.

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Asset Performance Management (APM) is typically thought of as being most relevant to asset-intensive industries that operate 24/7 and rely heavily on asset availability for their production volumes. Examples may include utility, petroleum, or mining industries.

It's true that many of the foundations of APM originated in these industries, and today they are the most progressive adopters of APM, especially for tools like condition-based maintenance (CBM) and reliability-centered maintenance (RCM).

However, there is another group of industries that stands to gain significantly from implementing APM and pursuing asset operational excellence — regulated industries like pharmaceuticals, food and beverage, and aerospace.

The reasons these industries need to pursue APM excellence may vary, but they share several key drivers.

Regulatory Compliance and Reporting

One of the strongest drivers for many industries is the compliance and reporting (of compliance) of key operational parameters.

For example, the aerospace and defense (A&D) industry must document critical manufacturing parameters like torque, certain manufacturing variables such as temperature and pressure, or other key measurements, as well as the certification and calibration information of the instruments that provided those measurements.

This type of information should already be collected as part of an APM deployment. Best practices dictate that any calibrated or certified device have its status checked and recorded any time it is used for service, daily production or any other use.

The information should be contained within the asset record and be auditable, as well as archived to preserve traceability required by relevant regulations. This requirement is also applicable to FDA and USDA regulated industries as well for some information.

Quality and Track and Trace Accountability

For those FDA and USDA regulated industries, product genealogy as it relates to manufacturing quality and weights and measures is a given. Any process upset that impacts quality or product safety must be traceable to specific lots or batches for recall purposes.

To accomplish that there must be a direct linkage between the MOM application(s) and the APM solution(s), so machine outages or issues can be associated with specific product runs. In addition, weigh and dispense data must always be collected in the pharmaceutical industry and in some CPG and food and beverage operations, and the calibration of the scale or other measurement devices must be recorded with the product data.

Even when not required for regulatory compliance good quality practice dictates that product consistency always be maintained and manufacturing equipment performance is a key contributor to that. Worn and poorly maintained equipment is just not capable of producing a high-quality and consistent product.

Process Consistency & Reliability

Many regulated industries like pharmaceuticals or food and beverages operate in a batch mode or a hybrid mode that may combine a batch run but in a short continuous process, or as in A&D as a discrete manufacturing operation.

There is always a challenge when starting a batch to reach a steady-state mode to ensure product consistency throughout the batch as well as from batch-to-batch. As discrete manufacturing tries to move to a more flow-based approach, companies are discovering the ramp-up issue as well.

Another challenge in discrete manufacturing is where an operator may have to perform multiple repetitive operations. Usually the first few cycles of a particular process are needed to “get the feel” of the equipment. In all of these situations when the equipment operates even slightly erratically, achieving the steady state or “normal” mode is far more difficult.

And one of the primary causes of erratic equipment performance is poor maintenance or mechanical failure of some type including wear and tear.

All of These Reasons Directly Impact Profitability

Failure to meet regulatory reporting requirements carries a direct impact on profitability, ranging from a fine or penalty that might or might not be substantial, but still is an unbudgeted cost, to outright invalidation of the product requiring rework at the least or scrapping in the worst case.

Likewise, products that do not comply with track and trace best practices put the enterprise at great risk in the event of a product recall. If you can’t tie a mechanical/process equipment issue to a narrowly defined lot or batch of product, the only recourse is a much broader recall. Obviously avoiding a recall at all is the most profitable approach, but in the event that a recall is needed, being able to minimize the scope has direct impact on overall profitability.

Finally, the more consistent and reliable the process, the less off-spec products produced, once again directly impacting profitability. So, for regulated industries, APM can be a real profit enhancement opportunity.

Dan Miklovic is the Principal Analyst in Asset Performance Management at LNS Research.

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