Just like a house, vehicle, or air conditioning unit, manufacturing plant equipment needs upkeep.
Upkeep can take a variety of different forms, too. While some equipment can be taken offline without shutting down production (usually referred to as “routine” maintenance), equipment critical to production requires an “STO.”
What is an "STO"?
An STO – short for shutdowns (S/D or SD), turnarounds (TAR, T/A, TAM), and outages – is a periodical major maintenance event. While these names are typically interchangeable, some companies define these differently with small nuances, typically related to the duration, size, or cause (planned vs. unplanned event).
When an STO occurs, an industrial plant (or sections of a plant) goes offline and equipment is inspected, repaired, replaced, and/or upgraded. Then, equipment comes back online, and the process returns to standard operation. While this may seem like a short window of maintenance activity, a lot of intense project management and planning takes place, sometimes for years!
How often do they occur?
Because of their significant impact, businesses begin planning STOs well in advance.
Short, small scope STOs may occur every 1-2 years, depending on the severity of the operating conditions. An example small scope STO, commonly known as a "pitstop," is a catalyst change-out. Large scope STOs have longer cycles, historically between 3-8 years.
Increased market uncertainty and tightening margins have pushed the industry to optimize STO scope and lengthen STO cycles. Many in the manufacturing industry are pursuing new data & technology-based solutions to manage the increased risk. An example of this trend is the rise of risk-based work scope selection, a semi-quantitative work process that weighs equipment failure probability with its consequence.
Why are STOs so important?
An STO is a critical part of an asset’s life cycle with broad ripple effects impacting:
Safety & Environmental Compliance - Industrial assets experience demanding operating conditions and deteriorate over time. Asset failures can result in dire safety, environmental, and economic consequences. Planning and executing
pre-determined large-scale maintenance activities (STOs) prevents failures and extends asset life.
Financial Performance – In highly competitive industries with tight margins, STOs have a direct effect on a plant’s profits. Not only are STOs a significant share of total maintenance costs, but the lost production time lowers profits even further. Because STOs are so impactful financially, STO performance often attracts the attention of management, board of directors, and shareholders (both good and bad).
Supply Chain – STOs can be a major supply chain disrupter, affecting inventories, supply, and pricing of manufacturing feedstocks, intermediates, and products. Small, unforeseen changes to STO duration can sometimes exacerbate the disruption both up and down the supply chain.
Customer Relationships – Unplanned changes to manufacturing operations affect a facilities’ ability to meet third-party contractual obligations. Frequent disruptions can erode trust in the relationship, affecting future growth opportunities.
STOs are a critical part of an asset’s life cycle. Proper management of STOs can lead to safer operations, reduced environmental risk, significant cost savings, and better relationships with upstream and downstream partners.
Stay tuned as we cover more on this critical plant event in the coming weeks!