Two schools of thought on the evolution of the Chinese maintenance market

Listening to the various speakers at the 8th Annual Process Industry Engineering and Maintenance Congress, which was held in Shanghai in September, and talking to attendees during the breaks, one could clearly distinguish two schools of thought on how the Chinese maintenance market will evolve. One is based on applying a Western model and waiting for China to adapt to it. The other believes in inventing new ways, “with Chinese characteristics”.

Some professionals insist that China will become more like Western economies and, for this reason, projects should be run like anywhere else: they explain how by following textbook practices, listening to foreign experts, recruiting and retaining talented people, they succeed in improving maintenance. Not surprisingly, most vendors and consultants adhere to this school of thought, which allows them to simply cut and paste a Western business model. Many consultants, IT suppliers, service providers, fall in this category.

Improvement initiatives usually involve hiring good people, outsourcing to maintenance service providers, calling in foreign experts or installing an “EAM” system from a major IT vendor. When faced with the too-often cruel reality – the “good” people already left the company (or have been promoted to plant managers), service providers competing on price alone failed to do a better job that the in-house team, foreign experts could not communicate with the technical staff, the EAM system is left almost unused… – the only answer is that we should do the same thing harder and better next time. Good news for vendors!

Interestingly, this approach sometimes works. At Siveco we know of several companies that have actually succeeded to replicate their Western model: it usually involved extensive maintenance resources that very few companies can commit, with direct top management involvement, several foreign experts in the plant, one or several third-party consulting firms on long-term contracts and local maintenance staff with extensive experience of Western culture. Those companies may be very successful at running their maintenance department “just like in the West”, but they can hardly be considered role models, as most companies cannot even dream of investing so much in their maintenance.

The second school of thought is taking an opposite view. It is that of Siveco and many plant managers with a long experience of maintenance in China. Those managers may be constrained by their corporate (Western or Western-inspired) models, e.g. for the mandatory implementation of SAP PM, but they know full well that it may not solve the problem. They know that China has special characteristics that makes the market unique: the sheer size of investments in plants and infrastructure, most rather new and modern, the shortage of multidisciplinary engineering skills so essential for maintenance, the lack of technical management experience, the undeveloped suppliers’ base, etc. As a result, approaches designed for the very matured Western markets often fail to deliver results, as noted above. People get blamed as the ultimate reason for failure: “our people are not mature enough” or “China has not reached that level yet”. A conclusion that vendors may find very convenient (they don’t get blamed), but which leave much to be desired from a plant manager’s perspective.

Tenants of this school of thought believe those unique market characteristics should be taken into account when running a project in China. In fact, they even believe that new ways to manage maintenance are being invented in China and could one day perhaps inspire other countries. After all, the same phenomenon has occurred in the field of construction: when multinationals started to run giant projects like the CNOOC-Shell Nanhai Project, they realized that Chinese EPC companies indeed had a lot to learn, but could also bring a lot to the table. This resulted in new ways to run large projects, faster and cheaper, yet in compliance with western standards and expectations, taking the best of both the Western and Chinese worlds. This is now relatively well-documented and well-accepted in the industry, although there were initially many skeptics, who claimed that China had no choice but to strictly follow Western ways in order to succeed.

What does this new maintenance approach, “with Chinese characteristics”, consists of? At Siveco, we pride ourselves of playing our part in this process, by using innovative technologies, designed in China but backed by decades of experience in other markets, as a structuring tool, to motivate the maintenance team, to organize them around clear processes and to gently enforce those processes from top management down to individual workers. A good example is the use of our bluebee^® mobile solution “for the worker of tomorrow”: the system requires scanning of asset tags (barcode or RFID); this simple constraint helps us build an inventory of assets, inspections and measurements points (which many companies using a so-called “EAM” still haven’t done today); it also ensures technicians have actually be to the equipment when performing inspections or preventive maintenance.

There is a clear disagreement between the two schools of thought. Will China “normalize” and become just like Western countries? Or will China evolves in its own way? It is hard to predict the future…. and we don’t pretend to. There is however agreement on the situation we face today, the fact that maintenance management is under-optimized in most Chinese plants and facilities, that countless improvement projects run on Western principles fail to achieve any ROI: training by experts soon forgotten, “EAM” system without any useful data in it, preventive maintenance program that only exists on paper etc. The real point of disagreement on: do we blame the people or do we blame the approach? Do we change the people or do we change the approach?

We believe that changing the approach is the obvious way to go. Our track record of maintenance improvement (over 600 customer sites in China) speaks for itself. While others are busy getting no result from applying methods designed 30 years ago in Western countries, we are very proud to obtain great ROI from solutions invented in China. Our Siveco team visited a customer last week: this company has invested millions of RMB in an advanced EAM solution from a leading US vendor. After three years running this system, most of their maintenance is still corrective and they don’t plan to change, in spite of running a very asset-intensive operation where maintenance is mission critical. After three years running this system, one of the best EAM solution in the world, they still haven’t printed one Work Order from it. An absurd joke? Not at all, in fact a rather typical situation. Will they fire this supplier? Not at all, they happily continue to pay for annual support, to the tune of half a million RMB per year, and blame themselves for the pathetic results obtained.

Tags： mobile、EAM、bluebee、Maintenance with Chinese characteristics、West vs. China