It is said that every dark cloud has a silver lining. Recessions, while painful, are an important part of the natural order. They help to shake out the excesses that tend to occur during the boom times, and refocuses companies on productivity and efficiency. A few sectors were particularly hard hit by the current worldwide recession. Primary among them are mining, manufacturing, retail and banking - which is to say the entire supply chain that allowed first world consumers to maintain their excessively high standards of living. The reality is that consumerism will in future not be the growth engine it used to be, and the companies that catered to their whims will have to adapt or die.

It has become all too obvious that financial assets aren't all they were cracked up to be. For a couple of decades we lived under the illusion that share prices would always rise and that exotic financial instruments would on the back of this somehow generate non-stop value growth. With the veil finally lifted it's time to recognize the true value creators within the economy: the physical assets that produce the goods and services we consume. This is not to say that people and money does not help to create value, but they can only do so through physical assets. Physical assets' contribution to wealth creation has for too long been underemphasized.

A case in point is the PG Group, a significant global player in the glass industry. It owns the PG Glass retail chain and the Shatterprufe automotive glass brand. Another company of theirs, PFG, is the only manufacturer of float, patterned, laminated and toughened glass in southern Africa. Demand for their product has declined along with the housing and automotive industries, but glass production is a process that cannot be easily stopped or started when demand changes. Having recently doubled capacity at their PFG plant in Springs, PFG found themselves sitting with massive capacity, built at high cost at a time when the future looked rosy.

The PG Group has been a client of PRAGMA Africa, a physical asset management service provider, since 2000. Initially PRAGMA Africa was only involved at the PFG plant, but in 2006 they became the physical asset management partner for the entire group. The service involves the administration and optimization of maintenance activities. Using proprietary software tools and business processes, PRAGMA Africa is able to offer a cost effective alternative to in-house asset management. The primary value delivered by the service comes from the analysis of maintenance history in order to optimize maintenance plans, and the continuous improvement activities that are undertaken.

Inappropriate maintenance activities can be a major source of waste. Unnecessary or inappropriate tasks waste time and money, and increase the probability of failure if the task is invasive in nature. Appropriate tasks that are missing can lead to downtime, poor quality product or equipment damage. An important step in the process of preventing failures is to do proper failure root cause analysis. Only once the root cause of the failure is known can appropriate preventive measures be developed.

At PFG each maintenance planner, who are PRAGMA Africa employees, sits in on the daily operations meeting for their area. All downtime since the last meeting is discussed, providing the planner first-hand insight on which to conduct his analysis. At the monthly steering committee meetings, failure root cause analysis is a standard agenda item. All team members are also expected to come up with at least one proactive analysis per month.