2008-07-07 - An ABB performance-based service agreement has enabled Outokumpu to reduce maintenance costs at a Swedish steel mill by 58 percent while simultaneously increasing production by 80 percent.
By ABB Communications
Since 2001, the ABB Full Service agreement has enabled Outokumpu Stainless, in Sweden, to achieve a number of improvements at its Degerfors steel mill in Sweden. These include:
- a reduction in maintenance staff by 30 percent
- a 25 percent decline in total maintenance costs
- a 58 percent per ton drop in maintenance costs
“What’s most impressive is that in the same timeframe we raised our production volume by 80 percent to 120,000 tons a year,” says Mladen Perkovic, production manager at the facility.
Part of this increase in production was made possible by improvements in equipment availability and performance, and by greater focus on preventive maintenance. As a result, the mill has achieved international benchmarks for mean time between failure and mean time to repair, equipment lifecycles have been extended, and unplanned stoppages eliminated.
“We raised our production volume by 80 percent.”
- Production manager Mladen Perkovic
Performance incentive
The Full Service agreement sets performance objectives that reward or penalize ABB according to the results achieved. This approach allows ABB to share the risks and rewards of plant maintenance, and provides the company with an incentive to continuously improve its performance.
ABB has more than 150 Full Service agreements with customers all over the world and in a variety of industries including chemicals, consumer manufacturing, oil and gas, mining, petrochemicals and pulp and paper.
One of the many benefits for Outokumpu Stainless is that the agreement is helping it be successful with its own customers. Recently the Degerfors mill scored 91.2 percent on its customer satisfaction index.
Click here to read an article in Maintenance Technology on ABB Full Service achievements at Outokompu.