Maintenance of Industrial Assets

This report evaluates the maintenance process of industrial assets by Innovative Electronic Corporation. It discusses the importance of maintaining physical assets, the process flow of the company, the 10 crucial assets, factors for replacing or repairing complex reachable items, controlling rotables, and the mission and vision of the company. It also examines the development and effectiveness of maintenance objectives and the leading and lagging KPIs of the maintenance department.

Maintenace of Industrial Assets

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Executive Summary
The common types of assets include a wide range of resources owned and controlled by
corporations. These include current assists, non-current assets, physical assets as well as
intangible assets. Maintenance of physical assets is one of the most crucial tasks on the part
of the management team who are responsible to upkeep the required and necessary facility or
asset. In this report, an evaluation of the industrial assets has been conducted so as to
determine the positioning of the company and its effectiveness in functioning. Innovative
Electronic Corporation is a USA based company that have significantly managed and
maintained its assets. There are 10 crucial assets that are significant for the functioning of the
company. The company has taken up diverse strategies to maintain its industrial assets.

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Introduction
Assets represent ownership that can be eventually turned into cash and cash equivalents
(Davies et al, 2017). Classifying industrial assets based on their physical existence involves
tangible and non-tangible assets (Liwski and Gebel, 2018). Tangible assets often comprise a
significant portion of the total assets of an enterprise, and consequently secures a significant
position on the Balance sheet of an organization (Basnan et al, 2017). Maintenance of these
assets involves a great deal of task on the part of the maintenance department and this is one
of the reasons that each unit of the assets must be categorized as well as evaluated based on
the classification.
This report represents an evaluation of the maintenance process of industrial assets by
Innovative Electronic Corporation. It is a small electronic processing company established in
USA dealing in the production process of electric with latest technology. The process
involves processing of the electric to delivery of finished goods to the end-users. This report
aims to analyse the maintenance system of the company in managing and controlling its
assets.
Process Flow at Innovative Electronic Corporation
Ensuring that the assets of an organization is well-maintained is one of the most significant
tasks on the part of the management of the firm (Lessmann et al, 2015). Moreover, almost
50% of the firms all over the world, have established maintenance department in the
organization which is solely responsible for the preservation, repair, as well as maintenance
of the machineries, equipment as well as system that is used for the functioning of the assets.
The most significant assets that are generally found in an organization are gearbox, factory
machines, electro motors and many others. These assets form a vital part of the process flow
for an organization.
Figure 1: Process Flow Diagram

Customer’s Packaging
Incoming Document
Inspection
CAD/CAM
Shear Laminate
Drilling
Through Hole Plating
Image Transfer
Touch Up
Pattern Plating
Resist Stripping
Etching
Shear Laminate
Image Transfer
Etching
Resist Stripping
Black Oxide
Cut Preparer
Inner layer Booking
Pressing
Packing and
Shipment
FQC/FQA
Open/Short Testing
V-Cut
Routing
Legend Printing
Hot Air Leveling
Gold Finger Plating
Solder Mask Printing
Tin/ Lead Stripping
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The above figure 1 represents the process flow of the Innovative Electronic Corporation from
production to distribution level. The company has very well carried out is processing with
regard to the energy flow. There are a number of assets which has been determined from the
above process flow these are discussed as follows:
Table 1: Industrial Assets at Innovative Electronic Corporation

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Assets Areas of Storage
1. Printing Machine Backoffice department
2. Plating Machine Factory
3. Etching Machine Factory
4. Laminating Machine Factory
5. Tin Stripping Appliance Factory Ground
6. Drilling Apparatus Factory Ground
7. Pressing Machine Pressing Department in Factory
8. Image Transfer Equipment Backoffice Department
9. Packaging Equipment Packaging Department
10. Delivery Vehicles Delivery Department
11. Solder Mask Printing Appliance Solder Department
12. Lead Stripping Appliance Backoffice Department
13. Gear Box Factory
14. Engine and Electro Motors Factory
15. Assembling Equipment Assembling Department in Factory
16. Drawing Machine Factory
17. Billing Machine Backoffice Department
18. Cash Handling Appliance Accounts Department
19. Infrastructure Factory
20. Processing Machine Factory
(Source: Innovative Electronic Corporation, 2018)
The above table 1 represents the industrial assets of the organization with twenty most
significant assets such as printing machine, plating machines, etching machine, laminating
matching, image transfer equipment, delivery vehicles, gear box, billing machine, processing
machine, solder mask printing appliance, pressing machine, cash handling appliance, engine
and electro motors, tin stripping appliance, lead stripping appliance and many others. among
them, the most valuable ones are those which are difficult to be replaced or when replaced
will make it difficult to perform at similar scale.
According to the point of view of the scholars Crespo Márquez et al (2016), it is an
evident fact that assets are the valuable component for an organization which allows it to
process and function effectively. Even a loss of single apparatus might cause obstruction or
hindrance in the overall functioning of the concerned department as well as that of the
organization.
According to the point of view of the academics Jamil et al (2015), the physical assets
that are directly linked to the operational process, are considered vital for the company and
the management’s decision to ensure appropriate strategies are implemented so as to maintain

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the same. The ten most critical assets of the firm involve those machineries and equipment
that are directly related to the production process. For instance, printing, laminating, plating
as well as drilling machine. In addition to this, the other assets include the etching machine,
laminating appliance, solder mask printing appliance, gear box and electro motor. These
assets are crucial for an organization’s functioning.
Asset Units
Assets units are the unit that is used to describe the asset and its type. For instance, the most
significant unit is the quantity of assets that are used for the process flow.
Factors for Replacing or Repairing Complex Reachable Item (CRI)
Among the 10 vital assets that have been described above, the most complex reachable item
is gear box which is of immense use in the factory. The gears that are used for specified
actions in the process flow are generally kept into the gear boxes. These boxes serve as the
fundamental asset of the firm because of its support to the significant functions of the
companies. According to the point of view of the scholars White (2015), making decisions
with regard to the replacement or repairment of the complex reachable items, turns out to be
the most difficult one for the management. The reasons behind such persistent is due to the
flexibility of use of the old gear box, adaptation with the gear box, resistance to change from
the worker who are uncomfortable while using the new gear box. There are a number of other
reasons behind this. It is due to the ease of use of the old gear box that the workers were
using earlier.
The cost of repairing of gear box is proportionate to the replacement cost. For instance, the
cost of repairing of the gear box might be $100 whereas, at this cost along with certain added
proportionate funds, it will be significant to procure a new gear box merely at $110. Thus, it
would be a crucial situation for the management of the organization so as to make the
decisions with regard to the replacement or repairing. According to the point of view of the
scholars Yang et al (2017), the cost of replacement and cost of repairing is usually compared
to each other in order to make significant decision. However, when the management are in
the dilemma is always the quality of the activities from such assets help to take such an
essential step.
Controlling the Rotables
Rotables are those units or part of the assets that are removable from that unit of property,
usually repaired or improved, as well as either reinstalled on the same or other property or

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stored for later installation. These rotables forms a significant part for the organization as it
merely involves repairs and replacement of the parts of the physical assets. The management
of inventories faces some challenges. According to the point of view of the scholars Zhuang
and Luo (2015) generally organizations are required to deal with substantia l number of assets
and their different parts; their demand pattern is often intermittent, thereby making it difficult
to forecast; because the purpose is to maintain operational systems.
Figure 2: Managing Rotables
The above figure 2 represents the process of controlling the rotables in an organization. The
process of controlling the rotables involve three major steps using inventory management
system to know about the items required. In addition to this, the equipment that are necessary
for controlling the rotables are required to be taken into consideration for the purpose of
controlling them. Thereafter the rebuilding process is continued for repairing and managing
the rotables.
Mission and Vision of Innovative Electronic Corporation
Mission
The company is highly focused on developing long-term relationships with the
customers by means of ensuring continuous quality improvement through its ongoing
investment in the development of people as well as in leading edge technologies (Innovative
Electronic Corporation, 2018). The mission of the company is to position itself as an
extension of its customers' operations. In addition to this, the organization focuses on high

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quality and responsive electronic services results in partnerships, which as a result yield
profits for the end users.
Vision
Innovative Electronic Corporation’s vision is to become one of the leading contract producers
of PCB assemblies in North America (Innovative Electronic Corporation, 2018). The
organization has strived to attain excellence through its innovation, quality control, as well as
customer service. In addition to the above, the management of the firm strives to build and
maintain strong relationships with its customers and along with it also assist them in being
successful in an ever-changing climate.
The organization has developed long-term relationships with its customers, which is
highly focused on continuous quality improvement through its ongoing investment in the
development of people as well as in leading edge technologies.
The organization have invested heavily in state of the art of maintaining the
equipment’s and assets so as to create advantages through assembly innovation. The
maintenance and repair workers fix as well as maintain mechanical equipment, apparatus and
machines. It is responsible for maintaining all facilities and grounds within the organization.
The maintenance department enable the workers to respond to rapidly changing market
conditions along with the resulting requirements.
Process for The Development of Maintenance Objectives
The maintenance objectives are solely dependent on the achievement of the corporate
objectives with maximum efforts of the people of the organization. The objectives have been
subjected to ensure the extensive availability of production equipment, utilities together with
the associated facilities and that too at optimal cost under acceptable conditions of quality,
safety as well as the protection of the environment where the organization carries it
operations. According to the point of view of the scholars Gârleanu and Pedersen (2018), it is
an evident fact that the principle of preventive maintenance is anticipation. Once the
maintenance department anticipates about the failure of any equipment or machineries, they
can become proactive towards implementing vital strategies which will enable them to make
the process flow followed by the company. On the other hand, Bounfour (2015) is of the view
that for the smooth and efficient working of the industrial plant, maintenance department,
with their anticipation skills helps in improving the productivity. In addition to this, it also
helps to keep the machines as well as the equipment in the optimum operating conditions.

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The objectives have not been written in the using SMART format. Thereby, it would be
effective for the organization to redraft its maintenance objectives so as to improve its
maintenance management.
The new objective would be to ensure maintenance of the tangible (physical) assets of the
firm throughout the year which enables the assets to perform with 100% accuracy. It will also
involve a regular check on the management system of the physical assets on monthly basis so
as to confirm that the process flow is uninterrupted.
Effectiveness of Current Maintenance Objectives
As per the reports of the company, with the help of the maintenance process, the
company has able to decrease its equipment downtime and also reduced major repairs in
machineries which might have caused obstacles in the process flow. In addition to this, with
the maintenance of machineries, there is also better conservation of the vital assets with
increased life expectancy which in turn have eliminated the premature replacement of
equipment and machineries. However, the maintenance department has not taken into
consideration the system maintenance of back office department.
The back-office department has a number of machineries such as printing machine,
image transfer equipment, lead stripping appliance, billing machine. Up keep of these assets
are also equally important in comparison to the other crucial assets. However, the
maintenance department has taken least preparation towards maintenance management of the
machines in back-office department. In addition to this, the department has not taken
preventive measures with regard to the equipment so as to lessen the likelihood of its failing,
but then again it has taken proactive approach towards following analytical strategies for the
maintenance of the equipment in factory ground. Another area where the maintenance
objectives fails to meet the requirements of the organization is the utility area. The utilities
are the underlying requirements of the machineries and equipment that are being used for the
process flow.
Leading and Lagging KPI's of Maintenance Department
Leading KPI’s
The leading KPI’s are reliability of assets, which is assessed by measuring failures. In
addition to this, the other leading KPI’s include quality and speed of execution and
maintenance cost.

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Lagging KPI’s
The lagging KPI’s for Innovative Electronic Corporation is prediction of failure. Though it is
one of the most significant tasks above all others, however, anticipating the failures is a skill-
based task which consumes a lot of time.
Conclusion
The maintenance department is responsible and accountable for preservation of the
assets of an organization. It is evident fact that the cost of regular maintenance is very small
in comparison to the cost of a major breakdown at the idle time. The maintenance department
has been found to be responsible for the way equipment runs as well as looks for the costs to
attain the required level of performance. The foremost determination of regular maintenance
is to ensure that all equipment and machineries that are required for production purpose is
operating at 100% effectiveness at all times.
From the overall evaluation of the maintenance department of Innovative Electronic
Corporation, it can be said that the maintenance department has well performed its operation
that have led to the success of the organization as a whole. The company have heavily
invested in state of the art of preserving the assets and equipment’s in order to create
advantages through assembly innovation. The maintenance and repair workers fix and also
preserve mechanical equipment, machines and apparatus. This process is followed in such a
manner that the company is able to accomplish its vision and mission along with
predetermined goals and objectives.

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