•  Plus

The Case for Managing MRO Inventory

In many organizations, maintenance, repair, and operations (MRO) inventory accounts for a significant slice—as much as 40 percent—of the annual procurement budget. Yet it is still not managed with the level of rigor typically applied to production inventory. There are five basic practices that can quickly close the gap with best practices in MRO inventory management.

Subscriber: Log Out

Sorry, but your login has failed. Please recheck your login information and resubmit. If your subscription has expired, renew here.

This is an excerpt of the original article. It was written for the March-April 2013 edition of Supply Chain Management Review. The full article is available to current subscribers.

March-April 2013

Inventory needs to be “optimized” to properly match supply and demand. This has become all the more important as competition intensifies globally and supply chains get longer and longer. Learn from a subject matter expert about the benefits of inventory optimization and how to get an IO initiative on track in your organization
Browse this issue archive.
Already a subscriber? Access full edition now.

Need Help?
Contact customer service
847-559-7581   More options
Not a subscriber? Start your magazine subscription.

In an earlier job, I was the materials manager in a manufacturing facility. A “tool crib” was the repository for office supplies and safety supplies; the bulk of the maintenance, repair, and operations (MRO) inventory was controlled by the maintenance department and was stocked all over the plant.

My group set out to bring best practice in inventory management to the MRO supply chain.
Fasteners were the first MRO component category that we addressed. We selected a supplier to come in and regularly replenish the fasteners in a central stocking area. The supplier inventoried and stocked the bins and invoiced us monthly. This simple process change eliminated the multitude of purchase orders and the associated costs that had been typical of the previous arrangement; it was also designed to ensure that maintenance staff always knew where to get the fasteners they needed for their tasks.

However, there was continued resistance to the idea of the materials management function taking control of all MRO supply. The turning point came when the stock of foundry tapping cones—used to control the flow of molten metal from a furnace ladle—was allowed to run out and the purchasing team had to source and expedite replenishment on a Sunday. It became clear to everyone that it made more business sense to stock foundry supplies in the tool crib. Soon after, additional supplies of tapping cones were moved into the crib. Not only were MRO centrally maintained and ordered after that, but the foundry maintenance area’s housekeeping improved because there were no longer skids of materials sitting around as “maintenance stuff.”

This complete article is available to subscribers only.
Click on Log In Now at the top of this article for full access.
Or, Start your PLUS+ subscription for instant access.

Not ready to subscribe, but need this article?
Buy the complete article now. Only $20.00. Instant PDF Download
.
Access the complete issue of Supply Chain Management Review magazine featuring
this article including every word, chart and table exactly as it appeared in the magazine.

SC
MR

Sorry, but your login has failed. Please recheck your login information and resubmit. If your subscription has expired, renew here.

From the March-April 2013 edition of Supply Chain Management Review.

March-April 2013

Inventory needs to be “optimized” to properly match supply and demand. This has become all the more important as competition intensifies globally and supply chains get longer and longer. Learn from a subject…
Browse this issue archive.
Access your online digital edition.
Download a PDF file of the March-April 2013 issue.

Download Article PDF

In an earlier job, I was the materials manager in a manufacturing facility. A “tool crib” was the repository for office supplies and safety supplies; the bulk of the maintenance, repair, and operations (MRO) inventory was controlled by the maintenance department and was stocked all over the plant. My group set out to bring best practice in inventory management to the MRO supply chain.

Fasteners were the first MRO component category that we addressed. We selected a supplier to come in and regularly replenish the fasteners in a central stocking area. The supplier inventoried and stocked the bins and invoiced us monthly. This simple process change eliminated the multitude of purchase orders and the associated costs that had been typical of the previous arrangement; it was also designed to ensure that maintenance staff always knew where to get the fasteners they needed for their tasks.

However, there was continued resistance to the idea of the materials management function taking control of all MRO supply. The turning point came when the stock of foundry tapping cones—used to control the flow of molten metal from a furnace ladle—was allowed to run out and the purchasing team had to source and expedite replenishment on a Sunday. It became clear to everyone that it made more business sense to stock foundry supplies in the tool crib. Soon after, additional supplies of tapping cones were moved into the crib. Not only were MRO centrally maintained and ordered after that, but the foundry maintenance area’s housekeeping improved because there were no longer skids of materials sitting around as “maintenance stuff.”

SUBSCRIBERS: Click here to download PDF of the full article.

SC
MR

Latest Podcast
Talking Supply Chain: Visibility and external manufacturing
Gartner Supply Chain’s Sam New joined the Talking Supply Chain podcast to talk about how business can overcome the challenges of achieving…
Listen in

Subscribe

Supply Chain Management Review delivers the best industry content.
Subscribe today and get full access to all of Supply Chain Management Review’s exclusive content, email newsletters, premium resources and in-depth, comprehensive feature articles written by the industry's top experts on the subjects that matter most to supply chain professionals.
×

Search

Search

Sourcing & Procurement

Inventory Management Risk Management Global Trade Ports & Shipping

Business Management

Supply Chain TMS WMS 3PL Government & Regulation Sustainability Finance

Software & Technology

Artificial Intelligence Automation Cloud IoT Robotics Software

The Academy

Executive Education Associations Institutions Universities & Colleges

Resources

Podcasts Webcasts Companies Visionaries White Papers Special Reports Premiums Magazine Archive

Subscribe

SCMR Magazine Newsletters Magazine Archives Customer Service

Press Releases

Press Releases Submit Press Release