Published July 14, 2016
There are functional silos that exist in the ERP/EAM process that are in conflict; here is how they relate to MRO inventory:
- Reduce Inventory
- Parts Cost
- Provide Reliable Assets
- Control Unplanned Downtime
- Concentrate on Capex
- Conduct Best Practices
- Product reliability
- Control Cash Flow
- Audit Trails
- Plant Management
- Require Operational Excellence
With respect to the MRO supply chain, each of these silos have divergent goals with little or no coordination. Although these silos impact the MRO supply chain, MRO stores management is usually ignored, creating misalignment with the goals – KPIs – of each silo and across the enterprise. To acerbate the situation, members of each silo have opinions as to how MRO inventory should be managed with little consistency as to who is in charge of procedures.
Manufacturers spend more than 40 percent of their budgets on maintenance related costs to make sure supplies are available to keep the plant’s assets running safely and at optimum levels. However, companies continue to allow duplicated, inefficient, and risky practices to exist, negatively effecting plant performance. Supply and Demand Chain Executive states that the longer a company exists, the higher the odds that it will rely on MRO master data catalogs comprised of inconsistent and poorly structured data and inefficient business practices. Add to this the lack of re-engineering expertise applied to SKU usage and little or no CMMS utilization and you reap significant deterrents to asset management initiatives.
One can conclude that the present MRO situation needs to be changed in order to achieve efficiencies equal to the operational expertise companies apply to their manufacturing process. The divergent silos must be coordinated to satisfy each while benefiting the whole.
MRO inventory expertise is centered on the need to employ four basic management components. In general, companies do not achieve or even address/recognize the need to implement these components in their operational considerations. WHY? The reasons are vast and froth with subjective as well as objective factors; they include:
- No time to change; too many emergencies caused by an unreliable MRO store room; Catch 22?
- No budget dollars allocated to change.
- Lack of knowledge on what to do; how to implement.
- Hubris; look who we are…. We know how to do everything the best way.
- Lack of supplier improvement initiatives.
- Lack of cooperation among personnel regarding individual job descriptions
- Inertia; this is the way we have always done it!
- There is nothing that can be done; put up with it (i.e. create your own uncontrolled sub-stocks).
To keep assets running smoothly, to obtain optimum plant efficiencies, change must occur.
Companies that believe they can achieve excellence themselves cannot or they would have done so. When companies attempt to improve, they rarely measure the benefits of the change much less install procedures to insure sustainability of that change.
Synovos is the very essence of change, allowing companies looking to improve the MRO supply chain through our individual services or as part of our enterprise value service offering.
Starting with a total commitment to manage the MRO storeroom’s material flow and audit trails, Synovos has expanded supply chain services to achieve a comprehensive offering for MRO inventory that satisfies all silos. The four basic management components are:
Supply Chain Services eliminate duplicate steps in the MRO transaction / material flow, reduce waste, and allow clients to recover MRO inventory costs that are not recovered in the manufacturing process. Services include sourcing & procurement, storeroom design & operations, logistics & inventory management.
Asset Services achieve dramatic cost savings that benefit each silo. They include re-engineering existing parts for better performance at a lower cost, commercializing SKU’s to avoid excessive price levels from OEM suppliers, restructuring storeroom configurations for supply efficiencies, and recognizing benefits of change for which the client was unaware. Specific services include workflow processing consulting, asset hierarchy and bill of materials development, maintenance planning & coordination, technical procurement, and Master Data LeadershipSM.
Technology controls and optimizes maintenance asset performance. Properly utilized, it benefits all silos. Applications of Synovos’ proprietary CMMS place the client in control of the maintenance process through stronger management tools. Features include scheduling, planning, preventive maintenance, work orders, calibration and safety management, purchase history, etc. technology services include Synovos EAM, DynamicSupply™ (our proprietary eSupply Chain Management tool), and mobility capabilities.
Enterprise Value integrates supply chain, asset services and technology across the organization in a unified, visible and effective approach. Benefits in utilizing the enterprise approach include dashboards to track and redistribute inventory to improve productivity; strategic sourcing plans developed to analyze spend and identify cost improvements; maintenance and reliability improvements through evaluation assessments on equipment, part criticality and overall process.
Synovos, the New Integration, allows the divergent silos to come together into a coordinated unit that satisfies the goals of each. There are various competitors to Synovos who offer bits and pieces of MRO benefits; there are none who bring supply expertise and asset excellence in sync, across the enterprise.