How to optimise bulk terminal performance

Based on a conversation between David Trueman, TBA, and Lukas Paul

Bulk terminals come in many different sizes and handle many different materials. Their performance determines how long a ship will take to load or unload and how quickly materials can be delivered along the supply chain. How can these bulk terminals measure their performance and identify key areas for improvement?

Overall Equipment Effectiveness (OEE) is an easy-to-understand KPI used to drive bulk terminal performance. David Trueman, Managing Director, TBA Doncaster Ltd, states, “OEE focuses on the areas of the operation where we can bring improvements that have a profound influence on the effectiveness of the operations regardless of the size of the terminal and the materials it processes.”

OEE Defined

Overall Equipment Effectiveness (OEE) is a measure of the percentage of time that is truly productive. To achieve a score of 100% means that the equipment is always available and always running at the design capacity, which is impossible to achieve in practice. Nevertheless, this KPI is very effective for identifying where improvements can be made and for comparing the performance of bulk terminals. OEE gives an accurate measure of bulk terminal performance regardless of the location, size, or application.

“There are several factors that make up the OEE calculation with each factor yielding valuable information about the equipment effectiveness and providing clues as to where improvements can be made,” explains David Trueman.

The formula for calculating OEE is shown below along with more details about each factor:

OEE = Availability x Performance x Quality

Availability

Availability is a measure of the actual production time of a bulk terminal as a percentage of the planned production time. This factor takes into account anything that makes the facility unavailable for production, including unplanned stops due to equipment failure or material shortages as well as planned stops for changeover. Some bulk terminals also include planned maintenance activities in their availability loss because these stops still make the facility unavailable for production.

Availability = Actual Production Time / Planned Production Time

Performance

Performance is a measure of the current run rate of a bulk terminal as a percentage of the ideal run rate. This factor takes into account anything that affects the ability of the terminal to maximise run rate, including equipment wear, substandard materials, misfeeds and jams.

Performance = Current Run Rate / Ideal Run Rate

Quality

Running an operation too close to the limits may result in quality problems with the product. This is unlikely in bulk terminal operations and the quality factor is most often excluded from bulk terminal calculations of OEE.

A live OEE dashboard for a typical bulk terminal is shown below.

Image: David Trueman / TBA Doncaster Ltd

Using OEE to drive performance

Assuming some typical numbers for a bulk terminal, we could calculate a sample OEE as follows:

Image: David Trueman / TBA Doncaster Ltd

Trueman says: “Experience shows that an OEE of 60% is a reasonable benchmark to expect when first measuring this KPI. However, root cause analysis can help to address the biggest contributing factors and drive improvements.”

Root Cause Analysis (RCA)

Root Cause Analysis can be described as “peeling the onion” by asking questions that identify the basic cause of availability or performance loss. The first layer may identify that availability and performance are equally contributing to the OEE. Peeling back another layer may identify that the largest contributor to availability is equipment breakdown and the largest contributor to performance is “Actual Speed Loss” as shown in the diagram below:

Image: David Trueman / TBA Doncaster Ltd

Once bulk terminal operators identify the main contributors to a low OEE, they can develop action plans to address these issues. This is known as capturing the low hanging fruit. “These few items have the potential to make a large impact on OEE,” says Trueman. “Using RCA, bulk terminals can improve their OEE to approximately 80%.” Of course, any improvements in OEE must also deliver a benefit to the business Profit and Loss, which is the ultimate measure of any business performance.

 

Typical low hanging fruit to improve OEE

Analysis of many bulk terminal RCAs over several years reveals some common contributors to a lower OEE. One or more of these contributors are often identified as the low hanging fruit to improve OEE.

1. Stopping the entire bulk terminal process should be a last resort. Minor issues can be resolved by stopping the feed temporarily so the problem can be resolved, which results in less downtime overall.
2. Hot swap at shift changes: Performing shift changes at the job site allows work to continue unabated rather than shutting down the system until the shift handover is complete.
3. Find bottlenecks and remove them: A reduced rate may be caused by a small bottleneck rather than a system limitation. Identifying these bottlenecks and resolving them can make a substantial difference to the current run rate.
4. If the bulk terminal is already experiencing a stop for one cause, try to take action that will prevent another stop later. For example, do equipment checks during weather delays so both activities happen during the same stop.
5. Overlap activities as far as possible to prevent stops. For example, cream digging the next hatch whilst the dozers are cleaning up allows the terminal to avoid downtime between hatches.
6. Some ships have a lower deballast rate than the bulk terminal loading rate. This means that the ship limitations affect the bulk terminal OEE. It may be worth renegotiating rates on known bad ships or cargos to compensate for the negative effect on OEE.

The importance of trustworthy data

The value of an OEE calculation depends on the quality of information used for that calculation. High quality data gives bulk terminal operators a confidence to use the OEE as an accurate measure of performance and as a means to identify low hanging fruit. Data on bulk terminals come from various sources and some of those sources are more reliable than others as shown in the table below:

Source	Description	Timing	Trustworthiness
System data	Captured from automated system	Real-time	High quality and consistent data
User generated	Mobile applications	Real-time	Using preconfigured standard entries improves the quality of this data
User generated	Handwritten logs	After the fact	Poor quality as each operator describes the data in their own words after the activity is complete.

The closer to real-time and the more automated the data collection, the better the quality of data for OEE calculations. It is also preferable to use bulk terminal operators for data capture than third party contractors because third party contractors do not have a vested interest in the results, and they record data from a different perspective to the bulk terminal operator.

David Trueman highlights the value of real-time data when he states, “OEE dashboards using real-time data from the automation system provide updates to OEE, availability and performance every five minutes giving bulk terminal operators almost immediate notification of factors affecting the effectiveness of their operation.”

Takeaway

OEE is a high level KPI that measures the performance of any bulk terminal by evaluating the equipment availability and run rates. Root Cause Analysis can help operators to capture the low hanging fruit and achieve an OEE of 80%. This improvement will directly influence the Profit and Loss (P&L), which is the ultimate KPI of business success.

For more insights into development opportunities and optimising OEE performance in bulk terminals, watch our on-demand webinar: PortZone Episode 8: Using KPIs to optimise bulk terminal performance