Procedure
Production Incident Reporting-33-020-0001
Name: Production Incident Reporting
Category: 33 Manufacturing (Production)
Sub Category: 33-020 Incident Management
Functional Area: Manufacturing
Document ID: 33-020-0001
Site: Corporate – Global
Country: All
Effective Date: June 16, 2022
Next Review Due: June 16, 2025
Author: Rick Weimer
Owner: Manufacturing Excellence Director
Procedure
Purpose & Scope
This procedure defines the reporting and investigation requirements for production incidents that
negatively affect production output, capacity, quality, yield, and cost for a manufacturing process. This
procedure applies to all Albemarle operated facilities.
Responsibilities
Corporate Manufacturing Excellence Group: Responsible for establishing and promoting the use of
this procedure and periodically assessing compliance.
GBU and Site Manufacturing Management: Establishing site procedures for production incident reporting
that comply with this corporate procedure. Using the production incident reporting process for continuous
improvement.
Definitions
Factory Cost – All cost required to operate a plant site except for raw materials and
assessments. (Run a cost center report for a site using ALB_EXP cost element group. Factory
cost is the value from the ****TOTAL CONTROLLABLE EXPENSE row of the report.)
MDC – abbreviation for Maximum Demonstrated Capacity. MDC is the best actual demonstrated
production rate for five consecutive days. The MDC daily production rate is used as the baseline for OEE
calculations.
OEE – abbreviation for Overall Equipment Effectiveness as measured by (A)vailability, (P)erformance and
(Q)uality. See corporate procedure 33-095-0002 for a complete definition.
O-OEE – abbreviation for Operating OEE. O-OEE is similar to OEE except that the impacts of business
downtime, planned turnarounds and conversions are removed. O-OEE reflects the performance of a
production unit when it is scheduled to run.
Trigger Values - Threshold values used to define levels (degrees) of production incident.
Details
Introduction
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Procedure
Production Incident Reporting-33-020-0001
All manufacturing processes experience production incidents that result in lost production or higher
cost. Manufacturing teams should work continuously to determine the causes of incidents and take
actions to prevent similar incidents from reoccurring.
This procedure is designed to ensure that the most serious production incidents are reported, properly
investigated, and managed.
Categories of Production Incidents
Production incidents are separated into two categories: Production Downtime, and Cost. Each category
has its own trigger criteria.
Production Downtime occurs any time the Operating OEE (O-OEE) for a process is less than 100%, which
means that either:
a) The process was down and could not operate for some reason,
b) The production rate was less than the established MDC rate, and/or
c) The product did not meet all quality specifications.
Corporate procedure 33-095-0002, Overall Equipment Effectiveness Tracking, outlines best practices for
tracking OEE, O-OEE and the causes of production downtime.
Cost incidents result in significantly higher manufacturing costs than planned. Examples include:
d) An equipment or system failure with high repair cost.
e) Repeat equipment failures that result in high repair cost.
f)
Lower yields/higher utilizations of raw materials that increase raw material costs for a process.
g) High cost for certain operating supplies (catalyst, packing, carbon beds), waste disposal, and
industrial cleaning.
Some incidents involve both production downtime and high cost. In these cases, the incident type with
the highest significance shall be assigned.
Incident Levels
Production incidents are classified into levels (0 to 3) based on the outcome or severity of the incident.
Level definitions and trigger values are outlined in the following sections.
Since every production site and business is different, each site shall develop incident level definitions
and trigger values that fit their situation.
It is important to set meaningful trigger values for incident levels. Level 0 and 1 incidents should
promote improvement at the unit/area level of a plant site. Level 2 incidents should promote
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Procedure
Production Incident Reporting-33-020-0001
improvement at the department and site level. If the corrective actions from all the level 0 to 2
incidents are effective, the most severe (level 3) production incidents should be prevented.
Trigger Values for Cost Incidents
The trigger values for cost incidents should be based on the size of the plant because a significant cost
incident for a small site may not be significant for a larger site. Table 1 contains suggested trigger
values for cost incidents based on a site’s monthly factory cost budget.
Table 1: Suggested Cost Incident Trigger Values
Size Designation
Small/Medium
Site
Large Site
Monthly Factory
Cost Budget
Less Than
$5,000,000
Over $5,000,000
Level 1 Incident
Level 2 Incident
Level 3 Incident
0.5% to 1% of
Monthly Factory
Cost
$25,000
2% to 4% of
Monthly Factory
Cost
$100,000
10% to 20% of
Monthly Factory
Cost
$500,000
$50,000
$200,000
$1,000,000
Level 0 Incident
A low severity production incident. Sites can decide if they want to set triggers for and track Level 0
incidents.
Level 1 Incident
A medium severity production incident that could affect the monthly performance of a site or production
unit if the root causes are not corrected.
Suggested Level 1 trigger values:
Production downtime between 4 hours to 24 hours
Cost impact greater 0.5% to 1% of monthly factory cost budget
In order to promote continuous improvement, these trigger values should generate two to four Level 1
incidents per month in each production area.
Level 2 Incidents
A serious production incident that negatively affects the monthly performance of a site or production
unit. Examples of negative effects include actual production below S&OP targets, missed or delayed
shipments, and unfavorable cost variances.
Suggested Level 2 trigger values:
Production downtime of 1 to 6 days
Cost impact greater 2% to 4% of monthly factory cost budget
In order to promote continuous improvement, these trigger values should generate three to four Level 2
incidents per year in each production area.
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Procedure
Production Incident Reporting-33-020-0001
Level 3 Incidents
A severe production incident that has a material impact on business performance, such as missing a
quarterly production target or sales forecast.
Suggested Level 3 trigger values:
Production downtime of 7 days or more.
Cost impact greater than 10% to 20% of monthly factory cost budget
Incident Reporting and Investigation
An incident report should be entered into the Facilex incident reporting (IR) system for all Level 1, 2,
and 3 production incidents. The incident subtype and impact are entered during the additional
information task shown below.
Figure 1: Additional Information Task Entry Screen
Many production incidents will require an investigation and root cause analysis (RCA). Corporate
procedure 00-030-0001, Root Cause Analysis, outlines best practices for incident investigation and
RCA for all types of incidents.
The RCA methodology depends on the incident level. Level 2 and 3 production incidents should
require a formal RCA using the Causelink software. Less formal methods of RCA may be used for
Level 0 and 1 production incidents.
Corrective Actions
Corrective actions should address the root and contributing causes identified in the RCA. Sites
should track the status of corrective actions using the Facilex Incident Reporting (IR) system.
Corrective actions from production incidents should be completed within 12 months of the
completion of the investigation.
Forms, Records and Attachments
a. None.
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Procedure
Production Incident Reporting-33-020-0001
Related Policies, Procedures or Other Documents
a. Corporate Procedure 33-095-0002, Overall Equipment Effectiveness (OEE) Tracking
b. Corporate Procedure 00-030-0001, Root Cause Analysis
References
a. Not applicable.
Document Retention Requirements
a. Incident reports shall be maintained for the life of the process.
Revision Log
Date
September 6, 2019
June 16, 2022
Description
Initial issue
Removed appendices and references that mention the SAP incident reporting
system. Incorporated use of the Facilex incident reporting system.
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