Challenges arise when companies are expected to not only meet all compliance regulations, but also operate at peak proficiency. Learn how two environmental mandates that are gaining more attention: air and water pollution and natural gas extraction.
Expanding Environmental regulations puts pressure on manufacturing and distribution companies, particularly as added publicity around environmental concerns drives the need for greater accountability. Discussions in the media and political arena about environmental issues continue to ramp up, and industrial facilities must prove they are taking measures to ensure safety and mitigate risks to the surrounding communities and the environment. The challenge arises when these companies are expected to not only meet all compliance regulations, but also operate at peak proficiency to maintain a healthy bottom line.
Two environmental mandates that are gaining more attention focus on air and water pollution and natural gas extraction. Recently, the Environmental Protection Agency (EPA) increased its fines and penalties for several air and water pollution violations. As a result of these expanding standards, manufacturers whose operations contribute to air and water pollution must utilize technology that can help limit damage and destruction caused from equipment and reduce harmful emissions to the environment. Other markets are also undergoing significant changes that will force companies to reevaluate their approach to operations and managing compliance. For example, as natural gas extraction gains a larger share of the North American energy market, organizations will need to adjust production strategies to meet stricter EPA standards.
Environmental regulation awareness and compliance is only half the battle. Understanding how to implement intelligent technology that simplifies the compliance processes is a major component for industrial organizations looking to thrive today.
As a result, manufacturers are turning to Asset performance management (APM) software as the driver of the Industrial Internet of Things (IIoT) to understand their assets on an enterprise level while also keeping up with regulations and maintaining their bottom line. This technology is capable of monitoring every physical asset in a production facility to ensure that they are operating within proper ranges. The largest, safest and most profitable enterprises have adopted APM for one very compelling reason: risk mitigation.
Risk is constantly changing and extremely difficult to predict with certainty. It’s tempting to focus on the obvious, short-term risks to daily operations, but focusing only on the visible versus the unknown impacts people, processes and profits in the organization.
In most facilities, risks are being managed; however, they are managed in silos. APM is all about connecting assets, effective strategies, people, and information to create a holistic view of plant operations that can be used to better manage reliability strategy and operational risk. When it comes to understanding risk, data can provide insights most operators didn’t know existed. But first organizations have to listen – to their people and production assets.
Environmental risk factors drive the need for a comprehensive APM initiative. Keeping production assets operating safely is critical to reducing or even eliminating equipment failures, catastrophic events and environmental incidents. Operating safely also protects a company's reputation and brand ? not to mention that it helps to ensure compliance with evolving safety and environmental regulations.
When managing assets strategically and effectively, companies are able to improve key operating metrics, as well as asset and system reliability and also improve productivity and revenues. In fact, managing assets efficiently helps companies to accurately predict and mitigate or avoid asset failure and improve production significantly, thus potentially save millions in lost profit opportunity. For large corporations, just a 1 percent improvement in production performance can be worth hundreds of millions – even billions – of dollars annually. We know how critical this can be in the oil and gas industry when BP is still paying the costs of a faulty piece of equipment years later.
It’s important for risk-mitigation management strategies to focus both on how individual critical assets are managed at the plant level, and by looking at the management of equipment and their combined performance at the enterprise level. It’s at the enterprise level that owner and operators can begin to realize significant benefits from leveraging data, trends and analysis for APM improvements across the organization.
Codes and regulations change quickly in the ongoing effort to create an increasingly safer workplace. Manual or paper-based processes and spreadsheets that used to track data for compliance are labor-intensive and error-prone, and create silos of often inaccessible big data that can become useless without context or recommendations.
To achieve a successful compliance strategy and safer operations, management must use the weight of their authority, defining responsibility and accountability throughout the organization and guiding the transition of asset management policy into everyday practices. Successful companies build a data governance model to support the enterprise – they ensure that their data is clean and stays that way. Those models have a well-defined vision and mission that are aligned with the organization’s strategic objectives. Roles and responsibilities, across all business units, are clearly defined and assigned to specific owners. The process of managing data quality is also clearly defined across all affected business units. Leading companies also regularly evaluate the technology and tools used in their APM strategies, as well as assess the effectiveness of their efforts against industry peers.
Mitigating the environmental regulation compliance risk to an organization is critical, but it must be done in a way that doesn’t hamper the organization’s ability to function as intended – to be innovative and competitive. Alignment with business objectives is critical. Compliance does not have to come at the expense of operational efficiency, and an enterprise-wide APM solution helps ensure both are balanced.
Meridium is a Roanoke, Virginia-based global leader in asset performance management software and services
for asset-intensive industries. Meridium increases the availability of assets, improves safety, optimizes cost and
lowers risk for global clients in more than 80 countries with more than 1,200 licensed sites around the world.
Through unique software developed in collaboration with clients, Meridium predicts and prevents asset failures
with intelligent asset strategies. For more information, visit www.meridium.com.