Managing Risk with Your STO Process

Shutdowns, Turnarounds, and Outages (STO): depending on your industry, you use one of these terms to represent the planned and controlled shutdown of assets for an extended period of time in order to expand or restore their capability. For the purposes of this post, let’s focus on the term “shutdowns” with the understanding that the principles apply to both turnarounds and outages as well.

The Risk

These events represent one of the greatest composite risks to your organization, with the impact on your customers, expense, and capital allocated to these efforts, and the sheer number of people (both internal and external) who participate in these events.

Couple this with the fact that you are performing many tasks that, at best, are performed infrequently, or at worst once in a lifetime, and you have a tremendous opportunity to stave off some dire consequences.

The Opportunity

The opportunity to avoid negative consequences is profound during a shutdown event, and can best be grouped into 3 categories:

  • Safety and Environmental

    This is job number one during a shutdown: “first, do no harm to our people or the environment.” This is non-negotiable and needs to be at the forefront of our thoughts as we consider the risk associated with each and every task we perform.

  • Duration

    During a shutdown, it is easy to lose sight of the customer and meeting their future needs. It is important to establish a firm expected duration based on careful estimation of each task and an understanding of their interrelationships in the form of the Critical Path. We must then strive to find ways to optimize these durations to provide some margins to deal with the unforeseen. First and foremost is to understand the financial impact of each hour of downtime and balance that against the actions we will take to optimize our duration.

  • Budget

    Finally, we establish a carefully prepared budget early on and work to meet those objectives throughout the entire shutdown process. Well-established methods to identify, analyze, and formally approve potential overages must be established well before we discover them.

The Method

The good news about shutdowns is that they are largely predictable. We generally know about them well in advance, and if we choose to use it wisely, we have the time to carefully prepare and analyze the risk we will face when the big event happens.

Sure, as we get close to the day of the shutdown, factors change: dates slip, adjustments (hopefully minor) are made to the scope, gaps in and the availability of needed materials begin to impact our readiness, etc. This does not change the fact that the months and months of effort we put in to prepare for this shutdown were well spent.

The elements we have put into place, and the risks we have considered and mitigated, still hold value even with the changes we will no doubt experience. It is important to remember that there are no heroes in the shutdown; the heroes put in the effort to get us to that day with careful and thoughtful preparation.

Given that preparation is key, a well-established process executed with a high degree of discipline and continual learning is the secret to success at shutdown management:

1. Establish

  • Form the shutdown team with specific roles and responsibilities.
  • Establish budgets (time and money) and set boundaries (what is in scope and what is out).
  • Identify all work that will be performed during the shutdown.
  • Freeze the scope at the end of this phase.

2. Prepare

  • Prepare job plans and shutdown schedules, and prepare for all materials, equipment, and contract labor that will be needed to perform the shutdown.
  • Analyze the schedule and identify the critical path (and near-critical paths).
  • Consider risk factors for each task and establish elimination or mitigation efforts for each.

3. Mobilize

  • Kit and stage materials and equipment.
  • Establish a war room.
  • Communicate the formal plan and schedule to all who will participate, beyond the small handful of people who have been preparing for months.
  • Execute checklists to ensure all preparations are in place.

4. Execute

  • Manage risk, communicate progress, and formally manage any changes that may arise. Remember: Work as a single team with frequent and disciplined face-to-face communication wherever possible.

5. Review and Improve

  • After the event is over and things have returned to normal, take a moment to formally sit down and learn from experiences.
  • Identify opportunities and be sure to take advantage of this learning during the next shutdown event.

Of course, the secret to success is in the details: making sure that the entire team (operations, maintenance, engineering, capital projects, contractors) are working together in unison with a single collective plan. This does not mean just during the shutdown – it is equally important during the time we invest in preparing for the shutdown.


Allied Reliability provides asset management consulting and predictive maintenance solutions across the lifecycle of your production assets to deliver required throughput at lowest operating cost while managing asset risk. We do this by partnering with our clients, applying our proven asset management methodology, and leveraging decades of practitioner experience across more verticals than any other provider. Our asset management solutions include Consulting & Training, Condition-based Maintenance, Industrial Staffing, Electrical Services, and Machine Reliability.

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