Fｉｒｍ:A.T.KeａrneｙCaseＮumber：Casesetup(factsofｆereｄbyｉｎｔervｉeｗer):YoｕrclientｉsaU.Ｓ．ｂａsｅdoilrefineｒyTheｒefinerｙhａsasｉngleｌocationandiｓasmａlltoｍｅdｉum－ｓizedrefineryYoｕrｃlｉｅｎt,aｌｔhoughｐrofitable,believesitisｌaｇginｇbeｈindｔhecｏmｐetitioｎanｄｃouldimprｏveYouａrebroughtｉnａspartoｆａjoｉntｃｏnｓultａnt-cliｅntｔeamthaｔwillrｅviewoveralloperationsａｎdmaｋｅｒｅcｏmmｅｎｄationsonwayｓtoimpｒoｖｅthｅbｏttｏmlｉneYouhａvｅbeenassｉgnedtowｏrｋwiththemａｉntenancｅdiviｓionThemaintenaｎcedepaｒtｍenｔ’sprimａryobjectivｅistoｐreveｎｔequipmｅntfailuｒeａndｔorepaｉrｅqｕipmentｗｈenitdoesfaｉlUｎdｅｒstanｄｉngofitsｏｒgaｎｉｚatｉonisimportanｔ.Itｃonsistsｏfthｒｅe(cuò)ｐrimａｒyareas：ｎinｅaｓｓｅtｓａreas，oｎecenｔｒalmainｔenａncearｅaaｎｄonegrouｐofｃｏｎtrａｃtｏrs．Tｈｅfirsｔtwoareaｓarｅe(cuò)ｍployeｅsｏftheclieｎt,ｔhethirｄaｎexterｎaｌsourceofｌabｏr.Ａnasｓetisaｐhyｓicalareaofthｅplaｎｔthatcｏntainsvariｏuspiecesofequipment(pumps，ｈeａt(yī)exchangers,etc.).Thｅreareniｎeａssｅts.ＥachａssｅthａｓaＭａinｔｅnanceSupｅrviｓoｒwhoｉsｒespｏnsibleｆoｒallmaintenａnｃetobｅｐerｆormedinhｉｓ/ｈerａsｓet．WorkｉngfortheMaintｅnaｎｃeSupeｒviｓorｉneachasseｔiｓ,onaverage,eleven“ｃｒaftｓｍｅn”．Thｅｃraｆtsmｅnａretｈeaｃtｕaｌworｋｅｒsｔhａt(yī)pｅrformｔhemaｉｎteｎａnce.Thecrａfｔsｍenａreｕnionizeｄanddiｖiｄeiｎtotｗelvedｉｆfｅreｎtcraftｄesignatｉｏns(e.g.ｅlectricｉａns，ｐipeｆitters,weldｅrｓ，etc.).Eａchｃrafｔdeｓｉｇnａt(yī)ionhaｓadeｆinｅdｓｅtｏfsｋｉlｌsｔheyａreqｕａlifiｅdｔopｅrｆorm.Theyareｎｏtallowedtｏperｆormsｋilｌｓoｕtsideoftｈeｉrdefｉｎedcrａft，ｏｒhｅｌpintｈｅpeｒfoｒmancｅofａctiviｔiesｉnｖoｌvingskiｌlsbｅyondｔheｉｒcraft.Collecｔｉｖeｌｙｔｈeｔweｌvｅｄiffｅrenｔcrａｆｔｓｃaｎperforｍanymaintenanｃejobthatｍiｇhtaｒiseattheｒeｆinｅry.Themａｉnｔｅnaｎcｅsuｐｅｒvisｏｒaｎdhiｓ/ｈerａssiｇnｅｄｃraftｓmenare“harｄwiｒｅd”tｏtｈeｉrassｅｔ.Ｔhａt(yī)is，tｈｅｙworkoｎlyoneqｕipmentｉｎthｅirgivenasseｔ．CentrａlｍaiｎteｎaｎcｅｉｓacentｒａｌizｅdpoolofMaiｎtenanceSｕpｅrvｉsorsａndＣraftｓｍｅn，wｈoaredispaｔchｅdｔoｓuｐpｏrttｈeｄiffeｒeｎtassetsdurinｇｔimesofｈighworｋlｏaｄ.Thｅyareemｐloyｅe(cuò)ｓofyｏuｒｃlientandｆitｔｈeｄesｃｒipｔionｃｏnｔａinｅdintheaboveAsｓetexplanａt(yī)ｉon.Tｈeonlyｄｉｆfeｒｅnceisthattheymayｗｏrkinanyofthedifferentassｅｔｓａsdeterｍiｎedbyｗｏrkloａd．Thereａrｅatotａlof１1MaｉntenaｎceSｕpeｒvisorsand10０ＣraftsｍenthatcomｐriseCｅｎｔralMainｔenancｅＣoｎｔｒａｃtoｒsａｒeagroupｏｆoutsidｅSuperｖｉsｏrsａｎｄCraftsｍｅnwhｏｓｕpportyourclienｔｄurｉngtｉｍesoｆhｉghｗorkload.Ｔｈeｙaｌsoａrecaｐａblｅoｆperｆormingａｎymainｔenaｎcejobthatmayarisｅ，butｄｉffeｒｆromｙourcliｅｎｔ’sCrafｔsｍｅｎｉｎtｈattheydiviｄeｔｈecoｌlectiveｓｋillｓrequireｄintofivｅdesｉｇｎatｉoｎsratherthaｎtwelvｅ.Ｔｈus,thｅcraftｓmｅnｏｆtｈeｃonｔrａctorａrecapabｌeｏfpｅrｆoｒmingａbroadｅrsetofskilｌs．Thｅy,ｌikeyourclient’sｃｒａfｔsmen,don’tｐerfoｒmskillsｏutｓｉdeｏfthｅiｒｄｅfineｄcrafｔbuｔｄoallｏwdｉfｆｅrentcraftdesiｇnaｔｉonstoheｌpeacｈotheｒ.Thereaｒeanavｅraｇeof７ｃonｔraｃtorMaintenaｎceＳｕｐeｒviｓoｒｓaｎd１40coｎtracｔorCｒaｆtsmｅnattheｒefineryonａnｙgivenｄaｙ.Qｕestｉｏn:Ｗｈatoｐportuniｔｉesexiｓｔtｏiｎｃrｅasepｒofｉts?Whatｒecoｍｍｅndatiｏｎscanyｏumaketocaptｕresaｖｉngsrelatｅdｔｏｔheidｅｎtiｆiedｏpportunitiｅs？Whaｔaｒethecostｓavingsaｓｓociaｔｅdwithyｏｕrｒｅcｏｍmenｄatioｎs?Suｇｇestedsolutiｏｎs:Tｈefiｒsｔｑuestiｏｎinｖoｌvesidentｉfyingｏpｐoｒtunitieｓｔoｉmｐrｏveproｆitｓ.Ｔｈｅcaｎdｉdａt(yī)ｅｍustsｔａrtwiｔheitheｒｒeｖeｎuｅｓorcosts.Ａlｔhougｈoneｃoｕlｄｍaketheaｒgｕmentthatmａｉntenaｎceｓuppoｒtｓrevｅnueｂymaxｉmiziｎgｔheoperatiｎgtiｍeoｆthｅreｆｉneｒyｅｑuipmｅｎt,mａinteｎanｃｅshouldbeｓeenｔobｅaｓupportｆunｃtion.Thuｓ,ｉtismｏｒeａpｐｒoｐｒiatｅtofocusoｎcｏstsandcostreductioｎ．Theｆollowｉｎｇqｕeｓｔionswiｌｌhｅlｐtｈecａndiｄａｔｅgaｉnｉnsｉghtiｎtocostrｅdｕctｉoｎoｐportuｎｉtiｅs.Ｈowｄoestheｍaintｅnａncedepaｒtmeｎttrackitｓcoｓｔs?Iｆtｈecａｎdidatephraseｓtｈequｅstioｎａboutmaterialｏｒｏveｒhｅadcosｔs,tｈeｉnterviewerｗoｕｌdinfoｒｍthｅcandｉdatethaｔdetａiledrｅvｉewedｓｈｏwednｏmajorｏpporｔuｎｉtiｅs．Tｈeｃａndidatｅｗouldｂesteeredtｏwaｒdlａborcostsandgiveｎｔheｆｏlｌｏｗiｎｇtaｂleｓregaｒdingmaintｅnancelaboｒcostsfortｈepasｔyear．Tosupｐｏrtｕnderｓtandingoftｈefoｌlowingｔables,Ｔｕrｎaroｕndworkｉslongｔermpreventｉveｍaiｎtenance(e．ｇ.ｃｏｍplｅtｅreｂuildingoｆaｂｏｉler)ｔhaｔmaybeperformedｏｎcｅe(cuò)veｒｙfewｙｅarｓ．Allotherwｏｒk(ｓhｏrｔtｅrmemｅrgenｃｙreｐairs,smａlｌscalｅpreｖeｎtivemaintenance,otｈerrｏｕtｉnework，etc．）fitsintothecatｅgoｒｙofＤailyworkＣｒafｔｓmenＤailｙwｏrｋTｕｒnａrounｄToｔａlCliｅnt$8MＭ$2ＭM$１0MMＣoｎtｒacｔor＄５MＭ＄9MM＄14MMTｏtaｌ$１3MM$11MM＄2４MMSuｐerviｓｏrＴotaｌCliｅnt$1MMCoｎtractｏr$０.5ＭMＴotal$１．5ＭMSｉncetｈeＣrａfｔsｍｅntabｌｅrepreｓenｔsａlaｒgｅrdollaｒaｍountthantｈeSupｅｒviｓortａｂle,itislogｉｃaltopｕrsuecoｓtsavinｇsｏpｐortuｎitｉesｉnthisareafｉｒｓｔ．WｈaｔiｓtｈｅutilizationofCraftsｍenｉｎtheａｓsｅts？Iｎｃeｎtｒalmaintenance?Aｎdforｃontｒactors?Asｓumeｅａｃharｅaisutｉlｉzｅd１0０%ofthetｉmｅ,5０ｗeｅｋsperｙear，40hｏursperweek．Hｏwｄoｅｓtｈelaborｃostofcraｆtsmen(＄２4MM)ｏnａreｆinｅｒy-ｓizeｄbasis(i.e.,$coｓｔ/perbarｒｅlofcrudeoilｐrｏcｅssed)comparewithiｎｄuｓtryaveｒaｇes?Consultingｙourｉｎdusｔｒｙdaｔabaseshowsｔｈatcosｔsａppeartobeａbouｔ20%aｂovetｈｅaverageofｐeｅrrefinerieｓ.Thｉsiｓanｉｍpｏrtａntｑuｅｓtiｏｎtｏdetermiｎｅｉfthｅreisａproblｅｍwithcosts(ｄon’tassｕmｅｔheｒeis,ｔｈeclientmaybeperforminｇbettｅrthanｉnｄusｔryaverａｇe!)Istheｒeanypartiｃuｌarreasonｗhyturｎarｏundworｋisｓoｈeａviｌysｋeweｄtowardcoｎtracｔoｒs？Turnarｏunｄworktendｓｔoｂemｏrecｙcliｃal.Ａnexｔerｎaｌｗoｒkfoｒcｅisusedtoabsｏrbsｏmeｏfｔｈisaｄditionaｌｗork.Kｅe(cuò)pｉnminｄthatbotｈｃlｉｅntaｎdｃｏnｔｒａｃｔｏrCrａfｔsｍｅnarecapａbleofpeｒformｉnganymaintenancejｏbattheｐlant.Afteｒfuｒtｈeraｎalysiｓoｆthｅtaｂｌeｓｔｈekeyｆacｔthａt(yī)shｏuldbecomeapｐeａrodｄisthelargedｉfｆerenｃeintｈecoｓtperuｎitoｆlaborbetｗeｅnyoｕrcliｅｎt’sＣraftsmenａndtｈeoｕtsidecｏntrａctｏr’sＣｒafｔsmｅn.Ｏftencandidatｅswillasｋfｏrthehｏuｒlyｗageratｅsoｆtheseｔwogroｕｐs.Tｈereｉsｓuｆｆicｉentdatａt(yī)ocａlculatetheｓｅｎumberｓ．Thecalcｕlａt(yī)ioｎis:?Ａnｎualｃosｔofｃlientcraftｓmen=$10MM/（11Ｃraftsmｅn/ａssetx9ａssets+1０0Crａftsｍeｎｉn ?? Centｒaｌmａｉntenancｅ)? =$５0,０00/yeaｒAnnualcostofconｔracｔorcrａftｓmｅn=＄14ＭM/140ｃontractorCraftsmen=＄100,00０/yearAgaiｎ,thisdiffｅrencｅｓhoｕldｐrovokeaｓerieｓｏfquestｉonstounｄerstandｔheｄifferenｃe.Iｓthｅreａｎyｄifferenceｉｎtheｗｏrkperformedbytｈecliｅnｔandcｏnｔｒacｔorｃraftsmen？No，oｔheｒtｈanthｅdｉfｆerenｔlｅvelsoｆTurnａroｕｎｄwoｒkｖs.Ｄailywｏｒkｐeｒｆｏｒmedasnoｔedinｔhepｒevioｕｓtabｌe.Bｏthｇroｕpｓarecapaｂlｅｏfdoinｇanyjobwｉthrougｈlyequaｌleｖelｓofquaｌity.IsｔｈeｒeanyｄifferｅncｅinｅffｉcieｎcyｂetweｅnthetwoｇrｏupsofCｒafｔsｍen？Thecandidatｅwｏuldａt(yī)thisｐointbeasｋedhowｔheywｏuldmｅasurethis.Afｔｅrreａｃhinganuｎderstａndｉnｇofthediｆficuｌｔｙinvolvedinmeaｓuriｎgtheeｆfiｃieｎcyｏfａworkforce(eｓｐecｉalｌyaunｉonｉzedｗorｋｆorce),theｃandidatewouldｂeｔoldthatthrｏughasｅrieｓoｆintervｉewsｗithmainｔｅnancesupｅｒviｓorｓ,ｔheｒeisacoｎsｅnｓusthatcoｎｔracｔorＣｒaｆtsmenarｅroughlytwiｃeａspｒoduｃtiｖeascｌiｅｎtcraｆtsｍｅn.Ｔhｉsiｓacriticａlpointinthｅcａsｅ.Tｈeｃａndｉdatemusｔrｅｃｏgnizethatinthepｒesenteｎvｉｒonmeｎtthecｌiｅntislargelyiｎdiffereｎｔaboｕtunｉtｓoflabｏｒ．Yｏucanhaveａｃliｅntｗorkerｗhoishａlfａseｆfｉcientorａｃoｎｔｒaｃtｏrｗorkｅrwhoiｓtｗｉｃeasexpｅnsive.Ｔｈeｋeynowistｏdetermineifｔｈerｅarｅwaystoｃｒeateaｎopportｕｎitywherｅthecｌiｅntwouｌdnｏｌｏｎgerｂeinｄifｆeｒeｎt.Wｈatiscauｓｉnｇthｅinefficienciesａｓsociatedwithｔheclient’slabｏr?Ａgａiｎ，thecandidatewoｕldｂｅe(cuò)ｎcouｒaｇedtooffeｒtheｉrownideas.ＡfteｒｓomｅdiscｕssｉｏnthｅcandidaｔewｏuldbetoｌdｔhａｔmanｙoftheMainｔenａncｅSupｅrｖisorscｏmpｌaiｎendlｅsｓlyａboutrestrictionｓplａceｄｏntheｍｂyｔheexisｔingunｉonｌabｏrcontracｔａｎdtｈetightnesｓofｃrafｔdesignａt(yī)ioｎs.Theiｎteｒｖieｗerwoulｄｐｒｏbeｔoensurｅthｅcａndidatｅundeｒstandswhｙtｈepｒｅsｅｎtｃraftｄｅsignatｉoncｒeａt(yī)ｅtheiｎefficiｅｎcies.Eｓｓentiａllywｏrｋistoofiｎｅlyｄivｉded.Itmａkeｓplanninｇanｄｓupervｉsiｏｎｅxｔｒeｍelycumbｅｒｓｏｍe．Asanｅｘample,ifonｅｏｆsｉxｃｒａｆtsrequｉrｅdtoｐerfoｒmajｏbｉｓａbsｅｎtｏｒlaｔe，theentiｒejobmustshｕｔdｏｗn，asｃｒaftdesignａt(yī)ionsaｒｅｎotaｌloｗeｄｔoｓuppoｒtotherｃraｆtdｅsignａt(yī)ｉｏnｓ.Ｉsiｔpossibletochangetheexistｉｎguｎioncontraｃｔ?Thｅpｒesentlabｏｒcｏｎtracｔiｓathrｅe(cuò)yearcontｒａctthatｉsｄuetoｂerｅｎegoｔiated/reneweｄｉnsｉxmonｔhs．Willtheunionｒesiｓtchａｎgｅsｔｏtheexisｔｉngcｏnｔract?Indeed！!Atthiｓpｏｉnt，thecanｄidaｔeshｏｕｌｄreｃognizeamaｊoｒ(ａlbeiｇhｔdiｆficｕlt）opｐｏrtｕｎitｙtｏreｄucｅlａborｃosts.Thecliｅntwoulｄesseｎtialｌｙｌiｋetohaveitｓoｗnemｐｌoyeeslookanｄｆｕnctionlikeitsｃonｔｒactors，butcontiｎuetogeｔｐaｉdatpresｅｎtｒates.Iｎｒｅaｌity,ｍanagemｅntｗilｌｎeｅdtoｍａkewageｃｏnceｓsionsinorderｔｏchａngｅprｅsenｔworkpractices．Howevｅr,throughplａｎｎｅdnｅgｏｔiationsascenariocanbecreａt(yī)edｗhiｃhｐｒesｅntｓａfavoｒａbleoppoｒtunityforyoｕｒclｉenttoｂegintｏreplａcｅoutｓｉdｅcｏｎtrａcｔorswithｉtｓｏwnCrａｆｔsmeｎ.Ｔｈereａreｓevｅｒaｌｗａystoaｄdresｓtheｔhirｄｑuestｉonofthecａse,tｈeaｃtuａｌｓａvｉngsｔhatmightbeachievｅd.Oｎｅquiｃkmeｔhodistｏasｓｕmethattｈesechaｎｇeｓｗouldbringmaintｅnancecｏstsｂaｃkinｌineｗｉｔｈｉｎdｕｓtryavｅrage.Utiｌｉzingtｈecostbenｃｈｍarkmｅntionedeａrlｉｅr,ｏneｃoｕldaｓsｕmecｏsｔscouｌdbeｒeduｃeｄtｏ$２4ＭＭ/1.２0＝$20MM,a$４MMsavｉnｇs．Asｅcｏnｄ，aｎdｍoreｄeｔａilｅd,metｈodwoulｄbetoｔａkeｔheｅxtｒｅmesｃｅｎariowheretｈｅclient’sCrａｆtsmenisｐａiditspreseｎtｒａt(yī)ｅ,bｕtiｓmadeaseffｉciｅntaｓthecoｎtｒactor’ｓＣrafｔsmen.Inthiscase，youｂeginwｉththｅpresentlevelof２0０ｃlieｎｔｃｒafｔｓmeｎｗhoａrefｕｎctｉonｉngas1