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Sigma Calc for steam leakage

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This topic contains 11 replies, has 10 voices, and was last updated by  C Smick 14 years, 2 months ago.

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  • #39328

    Kerem.
    Participant

    After a successful sigma project, we have accomplished to repair 1125 steam leakages in 4 months. now it is time for me to report the savings, but it is confusing to calculate the sigma level in the beginning since it is impossible to know the quantity of steam that was leaking before the project.
    Do you have any opinions?
     

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    #119409

    Tronan
    Member

    Hi Kerem,
    In your future projects ensure that you capture the current state in as much detail as possible, also before any action is taken.
    As you do not have the data to compare the before and after picture, look for other outputs. For example, what was the steam used for? For example, if it is for a mechanical process, has that become more stable? are their any charts on that machine? Also if you are loosing less steam now, it must have been costing you more in the first place to maintain pressure, what is the monetary effect of this? How does it affect the P+L?
    How do you know the project was successful?
    T.

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    #119420

    Kerem.
    Participant

    Tronan,
    since the steam consumption of the process is not only dependent to the steam leakage number but also the other Xs(capacity, raw material consumption efficiency etc.), it is almost diffucult to see solely the positive effect of the project.
     
     

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    #119424

    Tronan
    Member

    Hi Kerem,
    There must be a reason that you believe the project was successful. What was your success criteria outlined in the original project charter / PDF?
    For example, My boat has 563 holes in it, I have successfully fixed 562 of them, therefore I have reduced the number of holes in my boat by 99.8%. However when I put it in the water it will still sink.
    T.

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    #120222

    M.Ganapathi
    Participant

    Dear Kerem,
    Yr problem is really complex taking clue from my past experience in Oil Refinery as Energy Manager. I am not sure whether you really require to calculate the sigma levels before and after. Saving on a/c of steam generation (or consumption) must reflect the profitabiltiy of yr project, since reduction in steam leak must result in equal reduction in steam generation for a give activity level. One way of arriving at the saving is as follows:
    Before : 
    Steam generation  = X1 ( either in Metric Ton of steam or KCals of steam energy. KCals is preferable over MT for better accuracy)
    Activity level         = A1 ( Activity level is sum of all process activities like plant throughputs for ‘n’ no. of plants)
    Therefore, Steam requirement per unit Activity level (before) = X1/A1
    After :  
    Similarly, Steam requirement per unit Activity (after) = X2/A2,  perhaps yr activity level would  hv changed by now.
    So, if  (X2/A2) is less than (X1/A1), then definitely there is saving.
    The story does not end here. This method is simple if yr energy input is only Steam. Unfortunately that may not be the case since u might also use other energy inputs like Electricity, Oil, Gas etc.
    In such cases, X1 and X2 can be calculated by differial method as :
      (Total energy, in K Cals) – ( sum of all other energy except  steam) 
    Dr.M.Ganapathi
     

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    #120228

    Mike Carnell
    Participant

    kerem,
    I cannot imagine steam leaks as a worth while project. It may be worth money – but obviously that was not the reason you chose it since you do not know what it was worth – the solution can’t be to complex unless you have to go through the Dr.’s calculation. Basically when stuff comes out of the pipe where it shouldn’t – you have a leak – stop the leak. Where in that do you need to do some form of statistical analysis.
    When the stuff runs out of the pipe where it shouldn’t your equipment runs longer, you use more energy, etc. That is where the savings is. This is why you need to set up the Primary Metric in Define/Measure which you obviously did not do. You should have done a capability study in Measure which you obviously did not do and the financial benefits should have been estimated before it even became a project – otherwise how did you cost justify the project? (which you obviously did not do)
    When someone is sitting with a “successful sigma project” (I am assuming it was a successful six sigma project) that they have followed the methodology. Your gaps in a project are so huge I can’t imagine how you have deluded yourself into believing you have actually done a Six Sigma Project.
    BTW – if you would have done the capability study you would have figured this issue out before you completed the “successful sigma project.” At the end of the day – the sigma level is irrelevant.
    This whole thing sounds more like you or your boss or both of you are a late comer to the program and are trying to catch up. It seems more like you are trying to make something you already did look like a Six Sigma project.
    Just my opinion.
    Good luck.
     

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    #120230

    Ciaran May
    Participant

    After many years of making this mistake in the time before Six Sigma I have learned that if you need to identify the cost savings as part of your project then you need to get the Finance people involved otherwise you will find that they and others will develop suddenly in many cases amnesia and forget how things were in the past when the project is complete.
    In the Measurement phase of DMAIC try to always get a measurment of what the value to the organisation is of the proposed project, otherwise why do the project in the first place.
    In this case where you have steam leaks repaired you could simply establish how many historically the organisation had and how many it has now. I suspect that simply going out fixing steam leaks is not the value of the project but rather the process that you have put in place to prevent the leaks into the future or at least to respond to them so that your organisation will not have the on-going effect of the loss of energy. You could establish a control chart for daily non-conformances (Steam leaks) and show that the process is now in control. You could start to measure the value from now on of a steam leak by getting the finance people involved (other contributors have given good advice on the units of energy used) This will allow on-going interest in your control chart for number of steam leaks. Simply fixing stam leaks is not the project, putting in a process to keep them fixed or repaired is.
    Ciaran

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    #120235

    GP
    Participant

    Hi Karem,
    Since you have now completed your project and only need to arrive at the costing of the whole thing it should not be very difficult. I agree with all that you should have taken initial data for baseline reference to understand where you have made a difference but after the whole thing there is no point wasting time pondering over the past. My suggestion is as follows.
    Please find out from your finance department about the cost of producing the steam in the first place before you started the project. that will be some value because the requirement will be of a certain volume of steam at a certain pressure required by all dependent process.
    Now after you have plugged all the defects in the system, go back and check what is the same cost of producing the same steam now.
    Then also calculate the amount of money you spent in various activities while fixing the system might also include the cost of training in Six-sigma and rest of the fixing stuff…
    Then the savings will be = Old cost of production-new cost of production-cost of implementation.
    This value will be the money you have saved to the company.
    Use the standard calculator for calculating the defects Vs total population by making the simple assumption that previously you did have 1125 leakages and now you have whatever left-1125. The before and after above is enough for you to calculate.
    Please let me know if you need more info or help on this.
    -GP

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    #120237

    Kerem
    Participant

    Hi people,
    Simply fixing stam leaks is not the project, it was only one of the actions to be taken. In additon, fixing a steam leak maynot be that easy always, since tha plant is 24hr running raw material plant, which means just planning which “repair will be done when” is the subject of a few brainstorms. And to maintain 1125 succesful repairs in few months with a team of two welders needs a really well-defined system to be build up that should be carried out by the maintenance and plant responsibles. Also as a techical aspect, there were problems with material and maintenance system that should be improved.
    Mike, I can simply say the DMAIC is strongly used to improve the teams efficiency. But the real problem is the Xs, affecting your output that you control your performance on, may change during the project. In my project, the output was to reduce the steam consumption however steam consumption was affected also from the PH value of the steam income. And this problem was started at the control phase, which makes it difficult for me to only trace my own savings.

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    #120240

    Mikel
    Member

    Ask everyone in your management if this was the right thing to do. When they say yes, tell them you are off to fix another important issue for your business and not waste time chasing something they don’t know how to measure.
    The idea that we have to teach management to measure what they don’t know how is stupid. Why would any intelligent person let themselves get put into this box?

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    #120246

    Snipe
    Member

    Kerem,
    Interesting group of replies to your posting, and all bring up valid poiints.  Lets remember the most important thing, you fixed the broken process, and have saved the company money by making the systems more efficient. 
     Steam leaks may look like minor items to the folks without any utility background, but they represent tens of thousands of dollars leaking onto the floor sucking the process efficiencies out, as well as bleeding dollars from a budget as you have to generate more steam to overcome those losses or have a process that uses that steam operate at a lower degree of performance. It’s an easy fix to a big problem.
    Some may think, round peg, square hole, DMAIC doesnt fit here. But they couldnt be further from the truth. Not knowing the details of your project, I looked at it as a system, you generate steam to either: heat a building, to operate machinery, or to be used in certain manufacturing processes.  You reclaim the condenstate (or the steam after its done its work) as a source or raw material for new steam. You can calculate the amount of condensate you will get back in a perfect process, and measure how much you get returned via the trap/condensate system.
    So what is the problem, it could be that you are using more steam to do something, the end user is not getting the product (steam) at the correct pressure and temperature. That might enable them to use another form of energy that raises the operations cost more, they could be producing defenctive product from those processes. There is a gap between perfect and actual processes and your goal was to identify and reduce those losses. There are specs for pressure and temperature of the steam, the “health” of the condensate and , and there are actual readings you would get from your monitoring systems, so that is your VOC, and VOP.  From those you can calculate your process capabilities and convert those into sigma levels. Suprised no one questioned about opportunity counting,which being subjective can skew the data a bit. First pass yield might be a better measure.
    So congrats on a succussful project, no doubt it did what it set out to do, which is the bottom line. Dont let the “Tool Trolls” (or people that say you cant pass GO without using xyz tool) hold you up.  Every project might not use all of the tools, others might. The end result was achieved by the discipline of the DMAIC process. Think of your problem as part of a bigger picture, and open your thinking to other opportunities, the measures will become clearer and easier to see.
    Good Luck, John M.

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    #120259

    C Smick
    Participant

    Kerem,
    For your project you do not apparently have as a measure, any information on the amount of steam loss per usable unit. Therefore, you will not be able to calculate as savings directly from this type of data, because you don’t have it.
    What it appears you do have is defect information on how leaks were identified, how many there were, what kind of leaks they may have been, and when and how they were repaired.   You may need to classify your leaks into types of leaks, but you must collect some basic data on ‘steam loss’ for each type of leak  Then, you can use your defect data to show how the project went from an ‘out of control’ to a ‘controlled’ state, and estimate the savings.

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