OPERATIONS
FEATURE
Why you can’t get the parts you need Inventory challenges? A collaborative, holistic approach is key to breaking the cycle.
BY JAMES REYES-PICKNELL, PRINCIPAL CONSULTANT AND DANAKA PORTER, M.ENG, PMP The number one complaint from maintainers in the field is that they can’t get the parts they need in a timely manner. This is happening despite inventory on store-room shelves, stores personnel, inventory managers and busy purchasing departments. The established processes may be working as designed, but they are not delivering. Maintenance planners and supervisors become part chasers, tracking down components job by job and building up hidden inventories — unintentionally contributing to the very problem they are trying to solve.
Photo: © arhendrix / Adobe Stock
Zoom out to see the problem
Manufacturing assembly lines provide a confluence of parts, processes and actions that come together in a final product — their common goal. Business processes also have a common goal, but high levels of specialization and management in silos wreak havoc on the results. A lack of cross-functional understanding, such as between maintenance and inventory management, causes communication breakdowns among people, and the business processes they manage. Processes may be working at cross purposes. Stores and inventory management want to reduce inventory, rather than ensuring they have the right inventory. Purchasing wants the lowest pricing, yet delays often result in excessive production downtime. Maintenance wants immediate delivery and does whatever is needed to achieve it. Moreover, departmental goals can conflict with each other. For example, reducing transportation costs by only shipping full truckloads directly impacts the inventory or stores department’s bottom line and shelving space.
Zoom in to uncover the root causes @MROmagazine
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Stockouts indicate insufficient quantities often because the wrong items have been ordered. Identifying needs and demand can be problematic. Effective inventory management should forecast lead times and track trends, but this requires ERP software and diligent lead time tracking. Shorter lead times can reduce inventory; however, lead times do not consider the purchasing process time, which often adds time as purchasing seeks small dollar savings per part. When reviewed holistically, how much was really saved when ordering a cheaper part (with a likely longer lead time, and the additional time spent looking for that cheaper part)? Maintenance repairs are usually rushed; if an item is missing from stock when needed, planners will resort to direct purchase to expedite delivery. The PO is tracked to the WO but not necessarily against the stocked-out stores item. In stores, the higher-than-expected consumption escapes notice, demand appears lower than it really is, and it’s likely the item will be “out of stock” yet again
in future. Maintainers experience the higher level of consumption but are too busy, or don’t think to inform those responsible for inventory management. Eventually, they buy extras and stash them away in their shops. Forecasting inventory based solely on system purchases, which ignores direct buys, leads to inaccurate results. Often, if a part is needed sooner, a planner will bypass the system and purchase it directly. While the PO is tracked to the work order, the inventory itself isn’t logged, perpetuating the cycle. Additionally, if a part isn’t in stores, it’s perceived as “out of stock” by maintainers, who then buy it directly, further bypassing the inventory system. Ad hoc reductions in stock to eliminate non-moving parts can also remove critical spares if they’re not properly classified. Proper classification helps stores, inventory and purchasing understand substitution options, review frequencies and more. Maintenance and engineering must be involved in demand forecasting and decisions on sourcing critical Spring 2025 / MRO 9
2025-03-03 10:14 AM