Instead of managing discrete elements of the Fluid Use Process (FUP), Chemical Management 2.0 manages the entire process from selection through to disposal. By Outsourcing this non-core business process, Chemical Management 2.0 offers the next sustainable step change in continuous improvement and cost reduction. Stop managing price, start optimizing the Total Process Cost.
What was wrong with Chemical Management?
Sustainability. Though it has been evolving since its inception in the early 80’s, Chemical Management for the manufacturing industry was first introduced as a value added service by fluid manufacturers. By providing essentially a consolidated single invoice, inventory management service, suppliers were able to lower the price they were charging the market for their products. Once a client signed up for chemical management, the sales burden associated with selling and supporting their products (and protecting their market share) was passed onto a site manager that managed inventories and generated usage reports. The client “won” in that they were paying less per gallon for the products, their procurement costs were reduced, and they were assigned on-site personnel that would manage the flow of product into the facility. On-site personnel were cost effective, as their expense was subsidised in part by the margin the manufacturer was making off the protected product sales. The manufacturer won, since they had to spend less effort selling to the account and protecting their installed base, and had an on-site presence that would identify new opportunities to use their products. Since competitive fluid suppliers were re-directed to the Chemical Manager, there was little opportunity for new product from different suppliers to be introduced to the facility.
So, why is Chemical Management Unsustainable?
Since the focus was on savings through price reduction vs. total cost optimization through process improvement, Chemical Management in its original form hits a wall. Pressure to reduce costs year over year, causes the chemical manager to continue to use product change as a means to deliver on those savings. Eventually, using less expensive product causes costs to start to creep up in all other areas. Fluid choice and fluid condition starts to become the root cause to quality, productivity, equipment availability issues, etc. Its increases the risks associated with fluid usage, whether those risks are Health and Safety related or whether they increase the plants environmental risk. With less robust products, fluid consumption goes up, driving total fluid costs and the associated waste cost up as well. Competition is kept out of the facility since the Chemical Manager has a vested interest in protecting their market share, stifling real process improvement opportunities.
The Right Fluid, Managed the Right Way
Chemical Management 2.0 is about finding the right product, and ensuring that on an on-going basis it is being managed the right way. Industrial Fluids are there to support the manufacturing process. They are carefully chosen and need to be managed and maintained within very specific limits if the objective is to ensure that the plant is optimizing their Overall Equipment Effectiveness (OEE). By utilizing specialized expertise and employing a proven best practices approach to the total process, it’s possible to optimize process effectiveness while minimizing fluid and waste costs. Knowing what to look for, what technologies to use and what systems to follow, is what lets Chemical Management 2.0 find the right fluid, manage it the right way, and optimize total costs in a sustainable manner.
Find the Gap
Every plant that uses Industrial Fluids to manufacture their products is at a different stage with respect to Total Process Cost optimization. Zimmark’s Gap Analysis audit is the first step in identifying the opportunity. A no cost audit for companies that qualify, Zimmark’s Gap analysis audit looks at where the plant is now and where it could be if a focused, best practices approach was taken. Find out more.