The MRO Guy Blog

Picture1

The MRO Guy Blog is dedicated to sharing information and learning’s about MRO Spare Parts and equipment repair processes.  The MRO Spare Parts industry is over $700 Billion annually so it rightly deserves our attention to achieve the most efficient expenditures as possible.

Since most organizations have over one-third (1/3) of the MRO Spare Parts purchased never used, the opportunities to impact better spare parts and equipment repair processes are significant for manufacturing Plants, warehouses, and building facilities.  Remember – You just can’t make permanent repairs without the right spare parts.
Please give us feedback and topics of interest – Click Here!

September 7, 2015

MRO Spare Parts Journey – The 4 Keys to a Successful Venture

Asset Reliability programs require Manufacturing Plant maintenance and storerooms teams to routinely assess how they are doing (results) and what needs to be done.  Frankly, most organizations get stuck at that very spot – they don’t know what to do and the status quo ensues for long periods of time often marked with great frustration.
The central theme for today is to keep the approach simple so the organization can get started and gain some momentum.  Most physicists will tell you that the greatest force required to get an object moving (even one with wheels) is overcoming inertia.  However, once started the process gets a little easier and more speed is possible once things get rolling along.

When evaluating a MRO Spare Parts and equipment repair program it should be viewed as potentially the start to a journey and it, too, requires overcoming inertia.  The term journey means going from one spot to another with a road map of how to get to the destination.  Ensuring commitment to make the trip from all members of the team is a critical for success.  There are four key components to a MRO Spare Parts journey which need to be included.  Do these well and momentum can be gained quickly.

  • Core skill competencies – A great sports team can play with great enthusiasm, but without sufficient skills they will never be a winning team.  Same holds true for a maintenance and storeroom team.  Does the team have the knowledge to successfully reach the journey’s end?  Like a boot camp for the military recruits, certain basic information and skills are necessary to graduate to a level of excellence.  Inventory transactions, stock level setting, data integrity, Storeroom layout, technology understanding, CMMS record keeping, and inventory disposition are just a few of the core competencies requiring skill assessment.  Most teams are only as strong as the weakest team members so skill development is often an ongoing process.  However, many teams play to their individual members’ strengths for quick wins and success.  Few people are good at everything so why not let the team work on the areas where they do best?  This does not mean a team member should not know how to complete other key processes or tasks, but it suggests people are better at some portion of the job which their personal strengths and skill set show through.
  • Critical Processes – Does the team have the plays (processes) available to achieve success and does everyone know what they are?  Processes require a situation, people, technology and execution.  It is really that simple.  Take one of the elements out of the process and the result is not much to brag about.  Each of those elements can require different amounts of each component; however, they don’t go away.  For example, a check out log for a storeroom may require the situation of a part is needed by a single person along with a log sheet and a pencil to record the transaction.  While a pencil and paper process is not real technical, it meets the basics when executed consistently.  A watch out for many organizations is to identify unnecessary steps in processes such as copying papers which no one will ever use or need.  Keep it simple and repeatable as much as possible for ongoing success.  Continue to refine the process when more efficient methods are found.
  • Change plan – Great sports teams have a game plan going into a game and adjust to the plan as needed.  The same holds true with MRO Spare Parts, however, we call it a change plan.  This road map details how to reach the destination or goal.  It should focus on two initial elements – people and process.
    • “Who” is going to complete “what” and by “when”.  The “how” can describe the important tactic and may often require adjustments for success.  A change plan does not have to be difficult, but should focus on achieving the core competencies and work processes needed at the end destination.
    • Almost all people do not like change just for change sake. Change appeals to people when they are frustrated and their resistance to change is greatly reduced.  Focus on elimination of frustrating components of processes and removing barriers which get in the way.  This keeps people energized to make that journey.
    • However, if success is reached, NO one wants to go back to the old way and team frustration can be even worse than before.  Even leader credibility can erode with the team when this happens.  That is where the sustainability tactics come into the journey.
  • Sustainability tactics – As with sports teams, rebuilding and regrouping is difficult.  Once the destination has been reached, what is required to stay there?  Most people do not want to revisit the same activities over and over again.  So, what avoids falling backwards usually consists of performance measures as well as skill assessments along with a bench building strategy.  Great teams have a skilled team member available as needed to step in to fill the role when needed.  Additionally, how things are done (processes) is routinely evaluated for better ways.  That is how good teams remain that way – great people consistently executing great processes.

Again – make assessments and the journey simple with the key activities in place so future success is within grasp.  Avoid further frustration for the teams once the trip is started because of delays and cancellations.  Make a commitment to complete the journey and achieve greater success!

Connect with the 2015 MAPS Conference for more information and solutions at www.mapsconference.com/attend

 

April 14, 2015

MRO Spare Parts. The Critical Link to Successful Work Planning

A Guest Post by James Kovacevic with HP Reliability

At an average facility, the maintenance staff typically only have a wrench time of 30%. That means that they only spent 30% of their time actually performing repairs and PMs. The rest of the time is lost for various reasons. Two of the largest losses can be directly linked to the storeroom and the spare parts process. The maintenance staff spend approx. 15% of their time traveling and 12% look for parts.

I remember when I started a work planning & scheduling process at a facility. It was my first large attempt to pull the site out of reactive mode and deliver savings for the business. Having only read about it, I wasn’t quite sure of what was actually required to make it work. Soon after the process was put in place, I realized that I was missing a critical part of the equation; a well organized storeroom.

Work Planning only works when the Planning group and the Storeroom work together. Below you will find 5 steps to ensure successful work planning and storeroom integration.

1. You Must List the Parts On the Work Order. This sounds rather simple, but I routinely see sites without the required parts listed on the work order. Or if they are, the parts are not in the right location in the work order. This prevents the CMMS from working properly and often leads to the MRP process not operating correctly. I would only recommend including the parts that are required or have a very high likelihood of being required. All other parts should be listed on a BOM and supplied with the work order. This prevents the inflation of the storeroom.

2. The Procurement Process Must Be Effective. If parts are reserved and communicated to the storeroom via the CMMS, then the information must be acted upon. There must be a standard process in place along with a Service Level Agreement (SLA). This SLA describes where the storeroom will look for requisitions, part reservations, and how quickly they must process a requisition and goods receiving.

3. The Parts need to be Kitted. As seen above, the maintenance staff routinely spend 15% of time traveling and 12% of time looking for parts. The first two steps set us up for success, but now we need to execute. One of the most effective ways to improve wrench time is to kit the parts. Parts kitting occurs when the storeroom gathers and assembles all required parts for a job and places them in a bin. When the craft are ready to perform the job, they arrive at the storeroom and take the bin, reducing the time spent in the storeroom gathering parts. In order to make this work, there must be clearly defined process.

4. No Matter What, Do Not Release Jobs until Part are On Site. We took the time to plan the work, procure the parts and kit the parts. We must remain steadfast and if we are waiting for a single parts, the work order must not be released. This sound simple, but often work is released without all parts on site, because a senior manager stated “this work must be done this week”. If we release the work order before the parts are on hand, we lose the buy in of the craft, planners and the storeroom that we have made so far.

5. Learn From the Job. The parts were kitted, picked up from the storeroom and the work completed. All done right? No, we need to take the learnings from the job to improve it for next time. Make sure we record any additional materials the craft may have used, including consumables. This feedback should be recorded on the job plan, so that we can procure and kit the additional parts next time, further reducing the wrench time loses.
These five steps are simple in nature, but are often difficult to execute. If you are serious about improving the wrench time, work planning and the storeroom process at your facility, then these are a must.

Remember, to find success, you must first solve the problem, then achieve the implementation of the solution, and finally sustain winning results. Tell me where you struggle in the Work Planning and Storeroom integration. What did you do to overcome the barrier?

I’m James Kovacevic
HP RELIABILITY
SOLVE, ACHIEVE, SUSTAIN

HP Reliability is focused on bringing profitability to manufacturers, ensuring jobs and prosperous communities. We do so by equipping individuals and manufacturers poses the resources, knowledge and courage to sustainably lower their operating costs. You can contact them at:

Email: james.kovacevic@hpreliability.com
Website: www.HPReliability.com
Facebook: http://www.Facebook.com/HPReliability
Twitter: https://twitter.com/HPReliability

Sign up for the latest news from High Performance Reliability

April 2, 2015

MRO Keys to Equipment Bill of Materials

A discussion topic I have heard recently from a lot of folks is their frustrations about Bill of Materials. Some people call it BOM for short or even EBOM which is short for equipment bill of materials. Thought it would be beneficial to spend just a few minutes on this important tool and its value to your team.

First of all, think of bill of materials as a shopping list of parts which go with a piece of equipment.
It can be for any equipment whether it is a forklift, conveyor, packaging machine, or even a HVAC unit. That list of spare part components creates a shortcut list of replacement parts. Think about the alternative – we take the spare part to replace and then try to sort through the hundreds or thousands of parts in the storeroom or in an on-line catalog.

The second point about Bill of Materials is that it can leverage your CMMS system.
Most of the systems have a button that when a part is checked out – it can automatically be added to the parts list. Some even have this feature when purchasing and it is tied to a work order. Think about that – it really can save some time if you have for example 2,000 pieces of equipment. And if you have multiple pieces of equipment, then you can attach that list to all of the redundant equipment in your location. So for example – if you have ten forklifts and they are all the same, then you can have that same bill of materials updated for each.

Third, any new inventory adds should be automatically be added to bill of materials.
Why? Because the parts were purchased in anticipation of doing some work. Put them on the list as part of the add to inventory process and everyone gets the benefit right from the beginning. Put it off and frankly it may never happen.

Lastly, don’t underestimate the value of review the bill of material list.
Sure it can take some time, but if you can keep a log of any issues found and then address them, the task can be a little easier. Also, the frequently used equipment bill of materials may be easier to do or more valuable if there is regular corrective maintenance performed. Or it may help to get some momentum to review the simpler pieces of equipment. Often a conveyor may have ten to twelve parts which could be much less than a forklift which has hundreds of potential parts.

Bill of materials is one of the most valuable tools to a successful reliability team. If your team is struggling, then they may need some help getting started on effective equipment bill of materials. Have a strategy to deal with bill of materials – it can actually save your organization a lot of time, frustrations, and errors.

March 3, 2015

Three Key MRO Takeaways from the 2015 MARCON Conference

Last week, I had the privilege to attend the 2015 MARCON Conference in Knoxville, TN and there were some great people and speakers at the conference. If you don’t know, MARCON stands for Maintenance and Reliability Conference and is hosted by the University of Tennessee’s Reliability and Maintainability Center. This was their nineteenth annual conference and the MARCON event is working on doing something even more special for the twentieth annual conference next year.

With conferences there are usually some awesome conversations once everyone is comfortable in the setting. The 2015 MARCON conference was no different and I was fortunate to take part in several engaging discussions. I want to share a couple key takeaways from the many conversations. A couple of things really stuck with me from the conference.

First, it took awhile for everyone to warm up to the topic MRO Spare Parts, but once the conversation started it was very familiar. Those common topics included lots of frustration to get more done, finding better vendor and stocking options, and getting more organizational support. MRO Spare Parts is a very large investment – it is actually unbelievable how much opportunity is there when you start asking questions during any such discussion.

Second, is that many people are looking for a “magic bullet” as someone put it. I have to tell you that one just does not exist. There are a number of significant processes and practices which really make a difference in your results and you have to do them in a sensible order to make progress. In our everyday lives it may not seem fulfilling to complete the work which goes into these programs what with so many other priorities and distractions all around. We can dance around the subject for quite a while trying to find that short cut, but to sustain the needed MRO practices and processes it really comes down to doing the work to implement them unfortunately. The good news is that once in place, it is much easier to sustain if we all know what programs should be there.

Lastly, it can be downright overwhelming when you first try to tackle the idea of improving spare parts and reliability. The key is to assess where your organization is, design a plan to improve, develop a means to implement it, and then manage and measure the results. Managing and measuring results helps you know what needs to be tweaked to sustain the programs. We are really busy and if we can work with the end and mind as Stephen Covey phrased it, then we can make great progress. We just don’t want to backslide which is where that manage and measure component really adds substantial value.

I witnessed firsthand countless examples of folks there at the MARCON Conference seeking to save money and be more efficient. I shared with many that from my experience, MRO Spare Parts is a remarkable asset which can help set them apart from others when used effectively. A strategy with constant evaluation and program development yields the best long term results.

You can learn more about the 2016 MARCON Conference at http://marcon.utk.edu/

 

February 9, 2015

Three Strategic Technologies for Maintenance and MRO in 2015

Strategies give us a means to approach a problem, opportunity, or challenge.  If we don’t have a strategy, then we have to roll with the flow and hope to survive whatever comes our way.  It is unfortunate when we are caught without a strategy, but today is a chance to consider a couple to make a difference with equipment maintenance and spare parts in 2015.

Specifically, this week the strategy conversation involves some technologies which you will want to consider to help leap forward when it comes to equipment maintenance and spare parts results.  Often, I talk about not getting caught up looking for a “silver bullet” to solve all the problems at hand because I believe very few of those exist.

The technologies for discussion this week should only be a component of the bigger strategy.  By themselves they are not stand alone and they don’t fix things.  These technological changes simply mean better alternatives than today.  When used correctly, your team becomes more proficient.  So, what are the technologies described?

First is oil analysis.  Yep, oil analysis can be a leap forward when it comes to understanding what is happening with a sealed lubrication system for gearboxes, motors, etc.  It won’t solve the core problem, but it can provide clues for better understanding.  Mike Barrett of TestOil was on the MRO Guy Podcast and shared some great insights about the value of oil testing.  Oil testing is valuable for specific situations and applications.  A large expensive gearbox made in another country with a lead time of several months would be a great candidate for oil analysis and evaluation.  A $100 gearbox available within the hour would not be such a good candidate, but if failures are happening extremely more frequently, it could be well worth the time and effort during a “root cause failure analysis” evaluation.  Oil analysis can provide valuable information well before a component part fails on a piece of equipment; however, it still means you still have to take steps to correct the situation or the failure is going to happen.  You can learn more with many different companies such as TestOil (www.testoil.com).

Second is Ultra-sound technology.  If you have not heard of ultra-sound technology, it is a means to map changes in sounds coming from equipment components.  When you look at the P-F curve for potential failures over time, ultra-sound is an early indicator long before vibration or heat.  This technology is delivered through a probe to gather sound samples and software to track each reading over time.  Shifts in sound so minimal in frequency that are simply amazing are sources for impending failure indication.  This shift when recognized through regular monitoring provides much greater lead times to secure replace spare parts and devise strategies for repairs that minimize disruption to the organization and business.  Ultra-sound technologies can also be coupled with grease applications to ensure over-lubrication of bearings does not occur since over-lubrication is the largest cause of bearing failure by far.  Ultra-sound technology paired with a proficient member of the maintenance teams can be one of the most impactful solutions the organization may see with a very favorable ROI (Return on Investment) achieved within a few months time.  Two great resources are at www.uesysems.com or www.sdthearmore.com that provides ultra-sound monitoring solutions.

Third are the permanent magnetized motors.  Marathon Electric manufactures permanent magnetized motors with a permanent magnet to eliminate energy needed for induction.  Savings are 10 to 30% electrical savings and substantial weight savings with less copper windings required for the same rated motor.  Additionally, the motor foot print is smaller than the normal motor as well.  This motor is a little more expensive upfront, but energy savings and longer life cycle makes it a substantial winner in the long run.

In terms of construction, how do Permanent Magnet AC (PMAC) motors differ from AC Induction motors?  In the broadest sense, the major difference is in the rotor itself.  In a squirrel cage induction motor, current is induced into the rotor from the field (stator) through the air gap, and conducted through aluminum (or other material) bars, which are most often die cast in the slots of the rotor laminations.  In the case of a PMAC motor, the rotor itself contains permanent magnet material, which is either surface-mounted to the rotor lamination stack or embedded within the rotor laminations.  In either topology, electrical power is supplied through the stator windings.  You can learn more at www.marathonelectric.com.

Well, those are three strategic technologies to consider in 2015 which can start to make a difference right away If you  don’t have these technologies available, then certainly check them out.  Again, these won’t fix an issue at hand by themselves, but coupled with an overall strategy they can complement our equipment repair processes with great returns on investment for our organization.

January 14, 2015

Eight Must Have MRO Tools for Your Team’s Success

When determining how to be most successful with MRO Spare Parts and Supplies it can be extremely valuable to leverage tools to make the job of managing them easier.  Tools are defined as a means to complete work more effectively and safely.  Imagine trying to pound a nail into a board with only our hands or maybe even with a rock.  It could be impossible to accomplish very quickly or with the intended results.

Likewise with MRO Spare Parts and Supplies there can be means to make the job easier to reach our intended results.  The value of MRO tools mean that we can expect to get better results with less effort just like using the hammer instead of our hands to pound a nail into place.  So what are the best tools available to make a difference with MRO Spare Parts and Supplies?  Well, most of them may be within your grasp already and we just don’t realize it.

Tool #1 – Purpose of MRO Spare Parts and MRO Storeroom.  Always sounds simple, but these do have a specific purpose usually associated with the repair of equipment and the timing to do so.  No two parts are created equal so defining which ones to keep on hand can be very powerful rather than a pile of squandered money based upon feelings.  As a tool, the purpose reinforces what is needed and why.  A part installed every few years probably does not make any sense to keep in inventory because if first takes away from other repair work and second the part quality may be poor by the time we are ready to install.

Tool #2 – Inventory Add to Stock Form.  Once decided what MRO Spare Parts do for the equipment reliability program, it is even more important to decide which ones to keep on-hand.  Every dollar spent on inventory takes away from our weekly budget to accomplish need work and must be thought of as an investment.  By leveraging this tool, you can formalize the process and treat this decision like the investment it truly is.  The other unintended consequence is that it requires the team to do some leg work prior to adding an item to inventory.  Of course, if it is coupled with a “something comes in – something has to go” policy can really help protect the available space of the Storeroom from becoming over-filled.

Tool #3 – Critical Spare Parts Designation.  Not all parts are the same and some are so important to our organization that the lack of availability can mean the difference between success and disaster.  By having a criteria and a category for these “special” parts, then we can treat them differently with priority purchasing, special labeling, storage locations, etc.  This is quite powerful to keep the team focus on such as limited important few.  Usually, 100 to 200 spare parts should fall within this category in order to keep the desired level of focus and scrutiny they deserve.  Also, it is important to consider that the Critical Spare Parts can shift and change over to time to reflect changes in equipment criticality and spares availability.

Tool #4 – Min-Max Tool.  When we have several thousand spare parts, a process to establish stocking levels is quite valuable just because of the time involved if left to evaluate one at a time.  There are many tools, apps, and services out there to help with some being more expensive than others.  Not having a process to evaluate stock levels means that shifts in usage, lead times, and criticality are left to chance.  And chances are either we will have more over-stock items, more outages or worse yet both of those situations.  Test and evaluate the stock level setting tool and process which works best for your team.  Don’t overlook the financial value this tool can bring to your inventory and team’s success.

Tool #5 – CMMS.  Almost every Plant, Warehouse, and Building Facility I have visited has had a computerized maintenance management system (CMMS) of some type.  This is a system which our organizations often pay large amounts of money for usage and user licenses.  Yet in almost every case the CMMS is under-utilized because they did not take the time to capture data from inventory transactions or work completion.  In most cases it is an unintentional – the team is busy, someone is overwhelmed in the day to day or it is rationalized that no one uses the data anyway.  Think about a car you may wish to purchase – wouldn’t you prefer the one which has well documented service history and repair work?  The same thing applies to our equipment and spare parts – wouldn’t we want to know what work has been completed before?  After all, if nothing else it may prove helpful for trouble shooting purposes in the future.

Tool #6 – Re-order or Replenishment Reports. With several thousand spare parts on hand or even a few hundred for that matter, it can be downright frustrating to try to determine what stock needs to be purchased.  In several old systems, “stock out” cards were created when the last of a spare part was taken.  Today, with a great CMMS application it can do all that work in seconds and give you time to review each one individually as well as eliminate manually typing all the spare parts to order.  The value to this report, however, is certainly tied to accurately establishing min-max inventory stock levels for best in class value.

Tool #7 – Inventory Disposition.  A big hang up many of us have with doing something with obsolete or excess inventory is that we don’t know what to do with it once we have identified it.  Taking the time to establish the best, new home for any spare part helps determine how much it is worth to someone else and is frankly often tied to the spare part’s condition.  Like on a popular television show where they remind you that “condition is everything” can help reinforce to your team the need to keep spare parts in like new condition for many reasons.  All outlets for spare parts are of differing values.  Certainly “scrap” is the least favorable at just a few pennies on the dollar for return.  “Parts sharing” programs can be a much higher return if a suitable partner can be found such as a sister Plant or Business partner.

Tool #8 – Planning & Pre-kitting.  Nothing can help ensure the success of equipment repairs and budget usage like proficient work planning and pre-kitting of assigned spare parts.  Think about the alternative – a mechanic goes out to evaluate the requested repair and then searches through the inventory to see if spare parts are available while the equipment sits idle.  A separate area for pre-kitted spare parts is extremely valuable to coordinate the process of handing out the spare parts tray to go along with the work order assignment.  If we are not pre-kitting at least 75% of our planned work orders, then we have a planning issue within our equipment maintenance program which needs to be addressed.

Well, there you have it – eight essential MRO Spare Part Tools which each organization should already have available to leverage for success.  Almost all of these are free and require very little to put into place.  There may be more tools out there to utilize for an effective equipment reliability program and you should feel free to add to the list.  But if your team does not have these tools visible to the organization, then we are probably missing out on our potential success.

If you need help, please ask – we will certainly be glad to help in any way we can.  MRO Spare Parts and Equipment Maintenance programs can often account for a million dollars or more in expense each year.  Don’t you want to make sure your team is making those dollars spent be the most effective possible?

January 5, 2015

Getting the most from your MRO Suppliers and Vendors in 2015

Our MRO suppliers and vendors are a great resource for our team.  It goes well beyond delivering what we order.  If our vendors and suppliers are just delivering our orders, then we probably have the wrong ones and need to evaluate other alternatives.

Their reps and branch managers should be helping your team to be more successful.   Often, we forget that they are a resource which for the most part is overlooked.  Here’s how to get the most from our MRO Suppliers and Vendors through a series of six questions.  There’s probably more out there, but we want to make sure to leverage their expertise and all available services.  So here’s some questions to ask:

  • “What can you do for our team to save us money and allow us to get more work done?”  The vendors may be able to provide analytics of usages, bulk purchasing alternatives, better pricing, storeroom organization, automatic dispensers, etc.  By asking our suppliers and vendors, we can get them thinking beyond the status quo.  In some cases, the answer could well include helping the vendor to help you through some of your own practices such as reactive purchases which taxes all the normal purchase processes.
  • What are other customers doing differently that could help?  Think about it.  Your vendors and suppliers likely visit large numbers of other locations just like yours who may have alternative approaches as potential solutions.  They see what works and what doesn’t work; who has a problem and what they did about it; and progress made.  These other customers don’t necessarily have to be one of your organization’s  competitors, but one which has an equipment repair and MRO spare parts program.  If someone else has a better solution, it certainly makes sense to leverage their learning’s and success.  On top of that, the supplier/vendor likely has a point of contact to share their progress and details.
  • What items could your vendor keep on-hand instead of your team? Over one third of spare parts never get used and another third have low turn rates.  Sitting a spare part on a shelf for significant periods of time does not make it perform better – in fact, it will likely have a reduced life expectancy.  Also, spare parts kept on a shelf tie up valuable financial resources which could be redirected to getting more work completed.  You have to make sure this is a win-win situation as sitting a part on a vendor’s shelf for years is no better than sitting on your shelf.
  • What alternative items could be substituted for better pricing or better performance?  Vendors see what gets returned and what fails prematurely – they may have better alternatives for longer longevity of some spare parts.  Additionally, there may be a great OEM alternative to reduce the unit cost with similar or better performance results.
  • What can your vendor do to shorten lead times for potential critical or troublesome spare parts?   By shortening lead times particularly on problem spare parts or critical spares, your team may have more success in getting equipment repairs with new parts instead of making do or utilizing a rebuild to return the equipment back to service.  This can be another tactic for reducing min stock levels since the lead time to replace inventory is reduced.
  • What can be done to improve service through deliveries, paperwork, labels, damage, etc.?  Few things frustrate your team more than a problem delivery which creates lots of extra work.  Vendor and suppliers should be performance should be tracked through a scorecard to provide feedback as well as compare different ones with the same criteria.

These are a handful of questions to start the conversation about getting more work done and spending our MRO budget more efficiently.  If there are further questions to ask, please add to the list.  A short number of questions can be powerful in just getting to the tipping point of changing the mindset from the status quo.

If we leave the vendors/suppliers out of the conversation to improve MRO and equipment repair solutions, then we certainly have overlooked them as a resource whom should be interested in our success. 

December 15, 2014

Not So Funny Stories Which Led to Significant MRO Improvements

For this blog post I want to share a couple of funny stories or not so funny stories depending upon your point of view.  The point of the stories is not to make fun of an organization, a team, or an individual.  The purpose of these stories is to share stories of improvement by looking at a couple of the low points along the way.

When we acknowledge that situations like the ones we are about to share are unacceptable, then we give ourselves permission to start to move forward.  Some of the situations may sound oddly familiar or make you question if your own local team had a problem like that.  Fortunately, that part doesn’t matter because it is what we do going forward which really matters and that we know what type of situations to keep in mind.

Story #1 – “Not all storage space is good storage space.”  Space is always needed for most storerooms.  It really reflects that we generally have a lot of spare parts which are taking up room and probably going unused based upon my experiences.  Space utilization is always a good thing and alternatives are always evaluated.

One Plant decided to place a large number of motors and gearboxes in a raw material storage area.  Unfortunately, this area was one of almost 100% humidity.  Within twelve months the electric motors and gearboxes were showing signs of significant rust.  The following year a new MRO Storeroom area was approved with great storage capabilities.  During the transfer and evaluation process of the existing electrical motors and gearboxes almost all were deemed not usable and non-repairable.  The end result was about $400,000 of spare parts being scrapped; however, the good news was that the Plant now had a suitable storage area with major improvement to storage practices due to this learning experience.

Story #2 – “Going 0 for 3 with v-belts.”  We all have v-belts in storage and probably hanging from a peg.  Usually no one checks the date or condition just as a preventative measure.  One Plant went through 3 v-belts in less than a shift – the reason – the belts were very old.  No one knows for sure how long the belts were there since none were ever marked or tagged them.  Few things irate a mechanic more than making a repair only to find within a short period of time that they installed part failed again and the work must be done again.  In this situation they eventually found that two of the v-belts suffered from dry rot as a symptom of age and storage while the third belt failed due to “peg hump”.  Peg hump is the creation of a hump or weak spot in the v-belt resulting from hanging on a peg during storage.  The good news was that their vendor was very service oriented and opened up after hours to get the needed v-belt which was truly in new condition.  The Plant also began to tag each v-belt for dates, stored properly in cabinets, and checked belt condition during cycle counts.  All of those solutions helped the Plant avoid another catastrophic and frustrating v-belt situation.

Story #3 – “No tape for you.”  Duct tape is one useful supply and generally when people get in a pinch for a quick make do solution duct tape can enter the conversation to help get us through whatever creative thought we had.  One Plant had a problem letting it go.  During a conveyor belt repair the maintenance manager asked a mechanic to get a roll of duct tape to help pull the belting.  The Plant was paying a premium price for the duct tape at over $10 per roll so the Storeroom attendant told the mechanic the tape was expensive and they could not let them have the tape.  The maintenance manager intervened and ultimately the repairs were made.  Additionally, the Plant sourced a new vendor for the tape and the Storeroom team realigned their priorities when it came to equipment parts/supply needs especially during reactive maintenance situations.

Well, there are three quick stories – each had a move forward story and that is the really important part.  That embarrassing situation became the catalyst to do something different and commit to specific answers. So, what stories does your team have like this out there?  Again, the key is what are going to do in the future.  Here’s a defining moment for our team and our organization.  The question is what do we choose to do with it?

If you have a funny story like, please share.  The learning’s are priceless and helps others understand why we do what we do from a different perspective

December 8, 2014

How Two Different Plants Developed Team MRO and Reliability Skills

Have you wondered how to have a team with better MRO and Reliability skills? It is a tough challenge to build a high performing team with the skills and performance necessary for world class level of results. This week I want to spend a little time comparing how two organizations dealt with that question and the results I witnessed firsthand. No names are going to be mentioned here as I think you will find that these two organizations reflect what we all see on a regular basis.

Not sure if you have noticed this happening to you, but multiple times each week I speak or hear from someone looking for a great maintenance manager, a planner/scheduler, or storeroom person. And further yet, I am asked if I know of any maintenance mechanics who might be interested in changing companies. Last week, I received a forum topic from a LinkedIn group titled “where have all the good troubleshooting skills gone?”

I reflected upon a couple of scenarios I had witnessed and the significant differences in the approach, morale, and ultimately the progress being made. I will call these two by Plant A and Plant B for the purpose of the topic at hand. Both Plants work quite hard to deal with problems today and try to work towards better results with the current state firmly in the “reactive maintenance” level.

Plant A chose to find good people and had a development plan for each mechanic. They took great pride in their growth and what they had learned. The organization backed up the mechanic skill development by both reimbursing skill training and then paying for skill demonstration after completion. When another storeroom attendant and a planner/scheduler were needed they looked internally at their best candidate to further train and develop in those roles.

Plant B chose to use recruiters to find a planner/scheduler and storeroom attendant thinking that they could quickly jump the timeline to success. Over the course of three months they struggled to find candidates and once a candidate for the planner/scheduler role was filled they were convinced within two weeks that they had hired the wrong person. Surrounding Plant B was a significant number of organizations who competed with them for good candidates to bring onboard.

In those two situations which Plant do you think will eventually prevail? Both have a long ways to go to achieve world class levels of equipment reliability performance. Both are working hard at what they believe will be most effective and each is interested in ultimately being successful.

My own bet is on Plant A. In particular it is because technology is rapidly changing and a large number of skill technicians are retiring from our organizations. Those organizations with a plan to develop their individual team members can always hire a great candidate when they find one. If they don’t find one, then they certainly are still moving forward.

Plant B will be no better than their selection process and I have often found people are available for a reason and it can bring baggage to your organization. When any delays happen because we cannot find a suitable candidate, then any performance changing efforts are delayed, slowed, or ultimately don’t happen.

So how do you best develop your team? Here’s some key components from Plant A which I believe are worth noting.

First, have a development plan with a training calendar and tracking for each technician or staff member. If you have a plan this component in place then you certain have a foundation for success – tracking the success tells if you are achieving the plan or if steps need to be taken to intervene. Conversely, without a plan your team is most likely to remain the same and get the same results or worse. Remember – our world gets more complex constantly so doing the same thing means we are not able to overcome the unexpected variables due to the changing world in which we work. Leveraging the CMMS to track skills development can be valuable as single spreadsheets can be limited and lack transparency.

Second, you need to have buy-in from the people involved. This includes both the technicians and staff members working through their own development, but also the leadership of the organization. Certainly it costs money to do this, but it also costs money not do it. For example, if you have to bring in an outside company for PLC programming, then you should expect to pay 3 to 4 times what it costs in-house because these experts are in high demand. It can be good to annualize what is being spent and determine the cost/benefit to bringing that task back in-house.

Third, you have to have a means to develop the individuals that fits and makes sense. Adults learn in different ways, but “learning by doing” with someone instructing is quite powerful. This can be accomplished through workshops completed in house or having vendors with the expertise train and certify the individuals. Local vocational schools probably offer great courses with electronics for example which can be a conduit for your team to grow their expertise. Again, it is critical to check for accomplishment after course completion. Remember that if skills go unused, then they will be rusty at best when occasionally needed. Make sure to leverage training so proficiency is achieved and maintained.

Fourth, determine what is in it for the individuals. While everyone wants to believe that getting better proficiency is desired by everyone, the truth of the matter is that we are asking our team to sacrifice to that end. It may be a matter of covering job assignments while someone is in a workshop or it may mean someone gave up their family time to attend and evening electronic class. It all amounts to some sacrifice. In the end the individual has greater market value and can contribute more to the organization’s results. With sacrifice and achievement there should be great reward. Pay for performance is a consideration as it can mean greater recognition of the sacrifice and ultimately deter Plant A team and staff from joining Plant B.

Lastly, look forward at what the future of the organization looks like.  Some technologies are not yet born yet we know that change is inevitable.  Twenty years ago many processing operators needed a tool belt loaded with various tools needed possibly on a daily basis.  Now it is more common that adjustments to equipment require at most a screwdriver and more likely just an index finger to make adjustments on a touch screen display panel.

Well, that’s the observations from Plant A and a couple of thoughts about what can help define your organizations’ capability.  Plant B – I just don’t think they will make the same level of progress without some major frustrations and delays to any improvement plans.  Plant B is likely to have team members and staff looking for a situation like Plant A presents should it become available to them.

So the question becomes, does your organization want to look like Plant A or Plant B?  Which model are you willing to bet on for your teams’ future and success?

December 1, 2014

Building Your MRO Skills and Connections

Have you wondered how to get access to people with more information and answers to the everyday MRO problems? Building MRO skills and connections can be a great means to getting better results. This week I want to spend a little time on those topics through the Maintenance and Parts Solutions Conference (MAPS Conference).

Over the past couple of weeks, we have mentioned the MAPS Conference on the podcast and had an interview with Chuck Watson who is the Senior Project Manager for the event. The conference is sponsored by our parent company, the SBL Group, which also includes the MRO Guy podcast, MRO workshops, and coaching/consulting offerings. The vision of the SBL Group is to share information, coach others for better results, and help increase everyone’s network to achieve better solutions. The MAPS Conference is an extension of that same vision.

So, why did we want to put together a conference focused equally on skills/connections associated with equipment maintenance, spare parts, supplies, and outside service programs?

The first reason for the conference – help avoid frustration. If you have heard my story, then you know I have over 30 years of various operations experience. During part of that experience I was a shutdown manager at a mid-sized Frito-Lay manufacturing Plant many years ago. Up until that point in time I had mostly assignments in manufacturing and warehouse operations and had not been very involved with the spare parts area of the business.

During any Plant shutdown people seek what they can salvage – kind of like that leftover Thanksgiving turkey dinner. Well, I was shocked at the number of spare parts which no one wanted. With a timeline to turn over the facility to the new owner, there was not much choice. The parts went into the scrap dumpster. Altogether it represented about $300,000 of spare parts out of about a $1 million inventory. As you might guess, many of those spare parts should have been scrapped a long time ago, but here they were for me to scrap. That was my first exposure to excess and obsolete MRO which made a huge impact on me.

At the end, the Plant was left in great condition when I handed the new owner the keys. It had been very frustrating to deal with the mess, but I vowed to help others avoid that same embarrassing situation of having lots of parts which were ultimately valuable only for scrap. So, the MAPS Conference focuses on sharing base information and higher level strategies to use maintenance budgets more efficiently. Whether in a manufacturing, warehousing, or facilities setting the principles remain the same – purchase and install before the equipment causes downtime.

The second reason for the conference – showcase the many options which exist. After the Plant shutdown, I traveled to a large number of Plants, completed a CMMS (Computerized Maintenance Management System) application implementation, and helped Plants work through implementation of a Asset Reliability program.

As I was getting on a plane one day an old friend who worked in operations support saw me and said he had a question for me. His question was around one of the Plants he had just visited – I had been there previously – and the fact the operations team told him they did not have money to stock critical spare parts for the processing line. I assured him the budget was quite large and the Plant inventory had lots of parts; however, the Plant had the wrong parts and focused on other things. For the prior year there were 9,000 transactions for gloves and it represented more than 25% of the transactions for their 24-7 storeroom. The gloves totaled far less than 5% of the total dollar value issued. You could not have a five minute conversation with any of the storeroom staff because someone appeared more frequently than that to ask for some gloves. The site had run out of gloves previously so their answer was for the storeroom to take over all details as such. They really needed a different answer.

As I traveled more, I noticed every storeroom had some level of opportunity and we shared solutions which they could use. In the day to day struggles to survive many had a difficult time picking a strategy to follow. So, it became obvious people needed more solutions just to get them away from the current inefficient practices engrained in their location. With that in mind, we believe that if a storeroom has an annual budget of $1 million or more, they should be on the lookout for $100,000 or more in savings. With 30% of inventories going unused the opportunity is even larger, but $100,000 is definitely a great starting point. Like the glove example, you have to work at better solutions which really improve the total cost of equipment repairs – not just do busy work with little impact value to the organization.

The third reason for the MAPS Conference – create a larger personal network for possible solutions. As part of that CMMS implementation project I was given the task to develop and execute a project for data standardization. I had no idea where to turn after getting a folder of pre-work which had been thrown together previously. So, I took the opportunity to talk with each of the stakeholders I could find and get their perspectives as well as a little background on the prior work.

During that exercise I was told time and again “you need to talk with this person”. They were right. Slowly, my network of contacts grew and grew until I felt much more comfortable with both the project and who could help. In the end, it worked out well, but it stuck with me that a network of people is so beneficial and underestimated in value.

Repeatedly, I found myself in travels introducing contacts to people in need and encouraging them to find ANYONE who could help with the problem at hand. The MAPS Conference was specifically developed to bring as many of the “who’s who” or “go-to” people together to help others increase that network growth quickly. If all you know is what is in your own “four walls” of an environment, then you certainly lose out on that chance to gain a new insight or idea. Those situations could be worth literally millions of dollars when tested, applied, and replicated.

The final reason for the MAPS Conference – maintenance teams gave us feedback there was a need. Everyone is busy and it is tough to take time out to find solutions oriented toward better equipment maintenance, spare parts, supplies, and outside service alternatives. Repeatedly, our feedback indicated a conference packed with information, workshops, and solutions would be highly prized for its value. If there $100,000 available at their site, they were REALLY interested. Bring together a “who’s who” group of experts and no one we talked with felt they could get that kind of information doing the same thing they were today. We heard that same message over and over again.

There you have it – the four reasons the MAPS Conference came to be and over ten years in the making to build MRO skills and connections. I am very proud and honored to host the 2015 MAPS Conference. Our goal is to connect those “go-to” people in the MRO and Reliability industry with manufacturing and facility professionals across North America. Ultimately, we want to create an interactive venue so people can develop new solutions to that expensive and frustrating question of “how can we be more effective around MRO parts, supplies, equipment repairs and outside service programs?”

I am really looking forward to informative presentations, shared solutions, coaching interactions, and network building opportunities throughout the conference. We have assembled a great team to support the MAPS Conference. In particular, Chuck Watson is the Senior Project Manager committed to coordinating the details for great hospitality at an awesome place and all it offers – Louisville, KY.

The Maintenance and Parts Solutions Conference (MAPS Conference) – two full days, focusing on economical and time-efficient solutions to improve equipment repair programs and maximize the equipment spare parts investment. Attendees will have access to industry topics and solutions, which can be worth up to $100,000 or more for many organizations.

Make sure to check out more details at www.mapsconference.com and connect with us by subscribing to our newsletter, twitter, LinkedIn, or Facebook updates.

MAPS Conference = More information + Better Options + World Class MRO results

 

November 17, 2014

Three Initial Steps to MRO Excellence

So when it comes to MRO Spare Parts and Equipment Repair Programs, what does it take to get beyond average and move towards being exceptional?  And then more importantly – where do you start?

First, your team and your organization has to decide to do something differently.  This is a challenge as both the simplest step and the toughest step to take when it comes to spare parts inventory in particular.  I often liken it to your garage at home – sooner or later someone has to do something to make a difference – else it will never house a garaged car.  It’s up to you to decide if that is today which is what I recommend.  Delaying improvement is only more embarrassing.  So, the question turns into “when will you and your team be ready to start?”  Why not today?  What is stopping you from at least giving yourself and your team permission to do something different?  Change management often says people are adverse and resistant to change up until the point at which it is too painful to continue to do the same thing.

Remember my personal story of being a Plant shutdown manager and having to deal with the unexpected excess and obsolete spare parts which were not wanted by anyone?  Don’t let it get to that type of situation.  As a manager our role is to change outcomes to the positive and pursue continuous improvement.  Unfortunately, when it comes to MRO Spare Parts and Equipment Repair programs no one wants to look very deep into the opportunities.  It’s more about survival whether it is just the day, a performance review, or even a big push in volume.  Again, it is still there – so when do we want to decide to do something different?

Second, you have to decide where to aim – I recommend looking at work class level of KPI’s.  Like with most things in life you have to know what you are aiming to accomplish and a higher level like “world class” is tremendous because even if you don’t get there – let’s say halfway there – the improvement and change in the way we do business is phenomenal.  Make that same type improvement again and it becomes “a way of life” for the team.

Third, determine what the improvement is worth.  Chuck Watson from the MAPS Conference probably pointed it out best last week.  There can be several hundred thousand dollars within grasp and someone on our team may be more concerned about a few hundred dollars of travel expense.  His question of “who would not want to make that kind of investment?” resonated with many of us.  Are we so consumed with saving money instead of looking at it like an investment?  I have to say that if there is a million dollars on the table and to get it I have to invest $20,000 I am all in!  At $50,000 the ROI is still unbelievable good and I am still there.  Obviously, the higher the investment required the greater the due diligence required to verify the results.

That is where the second step is so valuable.  If we know where we are aiming, then we can do the math of where we are today compared to that point of intended destination.  Let’s face it most of the time that is an estimate – sometimes it is overly optimistic while other times it can be overly pessimistic.  What if we aimed in the middle?  If we are 50% wrong, then is making a change worthwhile?  In almost all cases I have seen in storerooms, with maintenance teams, and organizations the answer is a resounding “YES!”  That is especially true if we take the time and include multiple perspectives so we have an excellent chance for all of the facts surrounding the opportunity to shine through.  Typically, where you find frustration you will also find an opportunity and deep down your team knows it.

So, if we start with these three initial steps, then we have a shot at getting better.  Like previously mentioned, step one is the toughest to tackle.  Sometimes we think we already are addressing that and we have people working that issue.  But do we really?  If we can’t name the specific tactics underway and if we cannot see the activity that supports improvement, then we are just addressing it by talking about improving.  Talking is great for consensus building, but it is action that counts.

With that in mind, we are nearing completion of a two part video series which will be available in a couple of weeks to pose those important questions and help you decide the potential opportunity value to your team and your organization.  You see, sometimes we know the problem is there and we feel the everyday frustration, but taking those first steps – real steps – can seem insurmountable because there is so much else to do.  We are all busy – never a dull moment for us whether it is in manufacturing, warehouse, or facilities settings.  So these videos are designed to take five to ten minutes at most just to get us thinking about those first three steps.  Without taking those first there steps we certainly can’t take the next ones after that which starts us on the journey to exceptional.

Last week author Phillip Slater posted a blog about how we all win when we review our spare parts inventories.   Phillip is right – knowing our opportunities is the start of a path forward with better results and work life value for all of us.  Be on the lookout in the next couple of weeks – you can sign up to our email list for early access.

November 10, 2014

Two More Helpful MRO Network Additions

Over on the MRO Guy Podcast, we make regular introductions to “go-to” people and organizations. In this week’s podcast we had two great ones.  These introductions are designed to expand everyone’s access to more options, better expertise, and a larger network.

MRO Guy Podcast episode 017 introduced first Chris Moore with SDI and then secondly our own Chuck Watson with the MAPS Conference. The podcast can be found at http://thesblgroup.com/mro-guy-podcast-017-great-introductions-first-to-chris-moore-at-sdi-and-then-to-chuck-watson-with-the-maps-conference/

Chris Moore is Executive Vice President of Operations at SDI. Their vision is to help companies systematically deal with MRO Spare Parts inventories with a holistic approach.  Chris talked at length about some of the issues facing Plant maintenance teams and how SDI puts processes in place to work the details the maintenance staff just does not have time to address.  You can learn more about SDI at www.sdi.com

In the second introduction on MRO Guy Podcast 017 we met Chuck Watson with the MAPS Conference. Chuck is the Senior Project Manager for the MAPS Conference which means he is responsible for pulling together many of the details related to the conference.  MAPS is short for “Maintenance And Parts Solutions” so this is really a conference event focused on Equipment Repairs, Reliability, MRO Spare Parts, Supplies and Service solutions to problems people face daily.

We all know Reliability and Spare Parts problems are expensive and frustrating for folks in manufacturing, warehousing, and building facilities. According to Chuck, the MAPS Conference creates that missing interactive venue for greater access to a larger network where the participants can resolve their specific Equipment Reliability and MRO Spare Parts issues. The 2015 conference is in Louisville, KY November 3 and 4 of 2015.  You can connect for updates at www.mapsconference.com

For those who don’t know, Louisville is a great venue location with easy access to over 50 million people within a day’s drive and even more when flying into Louisville. Louisville is located near the geographic center of the US which is why UPS’s world port operation is at Louisville.  With lots of conferences out there, Chuck pointed out that only the MAPS Conference tackles the problem of how spare parts, supplies, and services impact equipment repair programs.

Both of the MRO Guy Podcast introductions were with people who had firsthand experience with some of the frustrations many face in day to day equipment repair settings. Whether it is manufacturing, warehouse, or even facilities environments it seems there is no shortage of work to accomplish.  Both Chris and Chuck represent organizations which have committed to helping others improve their current situations through better cost effective processes and solutions.

Because most people spend almost all of their budgets it is imperative that they are as effective as possible. Most of us have a lot more parts to buy than can fit within our budget.  Avoid the purchase of spare parts which are not even used can be one step in being more effective.  It is also extremely beneficial to examine the entire supply chain for better options.  Additionally, solutions which address opportunities around predictive maintenance spare part storage, data standardization, CMMS applications, service providers, etc. can further improve our overall results.

So, there you have it – introductions this week to two more people dedicated to helping remove some of the day to day frustrations related to spare parts and equipment maintenance. Everyone is busy and there is no shortage of priorities to take care of as part of the business.  People really struggle with “I have a problem and who can help me?”  Well, we are glad to make a couple of introductions to help further.

You can learn more about Chris Moore and SDI at www.sdi.com.  Connect with Chuck Watson and the MAPS Conference at www.mapsonference.com.  These folks really are excited to help others out there find some better MRO solutions – that’s particularly important when you consider all the things which impact equipment repairs and MRO Spare Parts, Supplies, and Services opportunities.

October 20, 2014

Balancing Maintenance Work and Spare Parts Budgets

Several Site Maintenance Storerooms have asked about the difficult subject of balancing spare parts inventory and the parts budget. Budget versus need is always a tough topic with lots of emotion associated with it – most of it not good. Frustration can set in due to the large amount of time dedicated to the subject and the frequent pointed feedback for inventory misses and over-spent budgets. The best solution is to evaluate the current processes for effectiveness and determine if process adjustments are needed. Again, the purpose is to have the right parts available when needed to prevent downtime with the Site production processes. Here are six questions to examine.

1. How are required inventory levels determined? A mathematical model often works best to reduce time commitments although many look backward at historical usage which can be misleading if there are specific equipment failures which required the associated parts. If the Site has a CMMS (Computerized Maintenance Management System) application available, there is often a wealth of data available to determine actual usage for a given period of time. Once the data is gathered, determine the rules for how much to keep. Suggestions – designate a small portion as critical to the process which means their failure has significant consequences; determine how often the Site desires to purchase as this can mean more frequent smaller purchases or less frequent larger purchases; determine what should be an ad hoc purchase for infrequent or planned repairs with plenty of notice.

2. What are the purchasing priorities? Often this becomes an emotional conversation determining the importance of the choices at hand. When there is $10,000 available to spend and $20,000 in identified parts to purchase, the decision process is critical to keep it from evolving to “winners and losers” for the final outcome. If this is a routine problem, then it is probably time to revisit question #1 again or do some analysis of current equipment condition versus the budget spend. Suggestions for priorities: purchase the critical spare parts first as these have been designated as having dire consequences for the Site if failure occurs; purchase the spare parts for critical work which again can mean eminent failure or high impact to the Site (safety, cost, quality, or service); long lead time parts which can sometimes mean months particularly if the parts come from overseas and must go through customs; remaining inventory items with priority given by usage quantity and out of stock items.

3. What is the approval process? This portion of purchasing can take unforeseen twists and turns which results in delays to receiving the needed parts. Should this process take longer than 48 hours, then the Site is potentially set up for failure. Manufacturing Sites can sometimes take two weeks or more to work through a purchase requisition approval.  Continually doing so will certainly flirt with large performance failures. The best solutions are the simplest in nature. Having a process with 3 levels of managers signing off on a requisition can be cumbersome and mean delays to any purchasing process. A best practice witnessed at many locations is for a team consisting of storeroom representatives, maintenance planners, and a maintenance supervisor to recommend spare part purchases for the Site with the department manager then approving. If the group is seasoned with a good track record, then it may not require the department manager, however, the team should be accountable for the results. Getting this process completed effectively at the lowest level in the organization is best as they will often develop alternative solutions when running into constraints which can mean getting more accomplished for the same spending level.  An example:  spend a little less to have parts rebuilt instead or acquire a part from another Site location instead of buying new. While this can take a little time to review and adjust the spare parts inventory and purchasing processes, the results can create a much different environment for the Site. Not doing the activities above effectively means difficulty with limited results.

4. What is the purpose of the inventory parts? While budgets get lots of attention, the inventory should be part of a strategy for maintenance programs along with the condition of the equipment and people skills. For example, a Site could say “their inventory purpose is to have parts for every need and every occasion.” A concern would be around what size of “checkbook” this would require. Often, Sites inventory consists of a variety of different needed spare parts:  frequent issued items (such as high weekly volume items); parts with long lead times; critical spare parts (which no one can operate without one); etc.  Should a Site want to do value buying of spare parts, then it may get to a point of balancing the actual spend versus actual usage – does not add value to buy and put on a shelf.  Additionally, a purpose or strategy for inventory can make alignment of the organization much easier as part of the communication process.

5. What is the staffing size available to manage? If a Site has $1 million in spare parts inventory, then it generally takes about 20% of the inventory value to manage it.  This can be comprised of people to receive, to store, to count, and to issue parts as well as people to do the buying. These are the significant and visible costs, but in addition there are the subtle costs of the portion of the building used, the utilities to light and heat the area, the cost of the racking or cabinets, etc. – you get the idea. Let’s stick to the original cost of staffing people – generally, the more the inventory kept on hand, the more staffing needed to keep up with the required activities associated with the inventory processes. On the reverse side of the argument, what happens when the inventory is too small? Less staff is needed. More purchases may be required. More downtime could be incurred in the manufacturing process or more activity costs required preventing the downtime and expediting the required parts. Given what a Site desires to spend may be a consideration, but if the staffing does not match parts levels, then those key inventory processes are at risk unless significant process changes are undertaken.

6. What is the PM process to identify needed parts? Too little inventory can put more pressure on the Preventive Maintenance (PM) processes to identify parts need earlier before failure. Longer lead time available equals more options on price, freight, etc. Review a sampling of the PM’s completed to determine accuracy of work to be completed and suggested parts. If the planning process can provide a two week window between identification of need and completion of work prior to failure, then the purchase process or inventory have to be in place to support. Failure to have enough lead time will risk process downtime or significant costs associated with expediting parts to prevent downtime. In some cases, it may even lead to use of a temporary fix while waiting for a permanent fix. If PM’s are completed only once per year and no inventory kept on hand, the Site has significant risk of the undesirable situations unless the completed PM work ensures performance and/or replacement parts are easily accessible..

While these questions are designed to help with the balance process of inventory versus budget, it actually falls to inventory versus process.  Budget results are a comparison of an implied control when in fact the real answer lies in managing the reliability program processes first.

October 13, 2014

Tips for Seeking Help to MRO Spare Parts and Equipment Reliability Problems

One of the toughest questions we all have to deal with is around knowing when to ask for help. It is always difficult to even bring the subject up – it is sort of like a confessional which no one enjoys.  Our desire to appear knowledgeable and have the answers at hand is hammered into us from an early age.

So when should you ask? I have to confess that I have struggled with this one as well, but have come to grips with it better over time.  If you can set up an approach criteria which can be used as a reference to reinforce, it will certainly help.  Ultimately, if we don’t, we may wind up asking ourselves “why did I live with that problem so long?”

Well, in our busy day to day routines we often believe we will get around to it, but days slip away and the burden becomes a little bigger until one day we can’t stand it anymore or the everyone else notices and now it has become an embarrassment. So, if we can determine how to get past it that burden is someone else’s and now we have it together.

So, here’s some thoughts gathered over the years around when to ask for help…

  • The Results are Poor – you and your team are accountable so deep down we know something has to be done. Getting different results by doing the same thing as before is certainly not realistic and not logical. Ask early when a trend first becomes obvious and it is respected. Wait until it has gone on for a significant time and it can be viewed as a personal weakness or performance issue.
  • The Consequences are Substantial – sometimes we have results which are okay and meet our budgets, but we certainly lag behind our potential opportunity. For Storerooms and equipment reliability programs with a budget over $2 million or more the opportunity can often reach 25% of those expenditures. Wouldn’t $500,000 or more in opportunity be worthy of at least a conversation? A return on investment (ROI) of three to five times the initial investment is highly prized and certainly worthwhile to engage others in proposals for improvement plans.
  • Lack of Expertise on Our Team for Change – it is tough sometimes to admit, but we just may not have the expertise to go take on a large opportunity. Taking care of the day to day business activities may be all your team can accomplish and if they are proficient, then that by itself is noteworthy. Outside assistance may provide a great learning and developmental opportunity which goes beyond just the value of the performance improvement. The team may not be better equipped to identify and work against those future opportunities or at least sustain improvement which is extremely critical.
  • A Timeline is Needed to Turn the Results Around – if you have ever had a presentation to a senior manager in the organization and have been asked when they can expect a specific turnaround in performance, it seems you can feel the temperature rise in the room and conversation. In all fairness, no one wants to live or struggle with a difficult situation, but it can become part of the normal business day. Putting a project together with a timeline at least signals to everyone in the organization that some thought has been placed in expectation setting. Timelines and managing expectations go hand in hand so when we don’t have a timeline, then we are at the mercy of others’ expectations and perceptions of our activities.
  • Other Priorities Are in the Way – may sound like a cop out, but we do juggle a lot of priorities with some set by us and some set by others. Where we spend our time and resources is up to us, but getting the organization to acknowledge a desire to complete them all quickly may expedite that conversation with a “what do we need to do?” question. It will come down to time, resources, and when. If we want it now, then we may realistically need help. Again, if it is substantial waiting and waiting for implementation costs the organization every single day.

There’s a quick list of considerations of when to ask for outside help – there’s probably a lot more out there, but the key question remains “how do you decide when to ask for help?” Well, not having at least a personal criteria program just doesn’t help the situation in any form or manner.

For any organization these same criteria can apply, but remember when it is just spare parts and equipment maintenance programs the impact can far reaching beyond those accounts. That is when people will rally around a gain in improvement or they can consistently point out that something needs done – unfortunately that is how people can react.

Just know that help is all around and the key remains when to seek out others to help resolve the problem opportunity.  

October 6, 2014

Security Tips for Your Building and Storeroom

There’s a lot going on in the world these days with some shocking news events at almost every newscast update. Often there is a situation which occurs at a manufacturing, warehouse, or building facility which makes the national news with sad consequences.

Ultimately, many are left to ask “how did this happen?” Well, in our busy day to day routines we don’t realize the dynamics of individuals with issues which may not be visible on the surface.  Add a lack of protocol to handle unfortunate turn of events and the recipe is set for a tragic outcome.

Some thoughts around building security program protocol…..

  • Guard the front door and the back door – it should be difficult for anyone to enter the building with the exception of the fire and police protection. If you don’t have a badge entry system for building access, it is time to get one. Have a system administrator with a back-up person so any changes are made immediately.
  • Have point of contacts at entrances – it is tough sometimes to budget for security personal and a receptionist, but having that initial contact is absolutely necessary. That role reinforces the protocols in place and is a first alert to problems. It is an extremely valuable position and we don’t realize it until there is a problem.
  • Multiple levels of access – not everyone should have access to everything. Multiple doors requiring badge swiping can help limit folks to specific areas as well as record who entered and when.
  • Intruder Response team – sounds like some hype maybe, but there needs to be a process or protocol to situations requiring action and a team works best. Additionally, laying out example situations and responses is an organizational requirement to meet the challenge. Meet, review, and practice for those situations as well as more protocols as needs are identified.
  • Get help – leverage the knowledge of local police and fire departments prior to problems. It is also a great idea to have them walk your building once per year so they are up to date on the layout, entrances, problem areas, etc. Know the vulnerable locations around the property and look at alternative options available to minimize risks.
  • Technology – leverage the best that fits your situation. Unfortunately, technology changes every single day, but video, access badges, electronic door locks, automatic traffic gates are all tools which may prove valuable just to provide additional controls.
  • Spread Awareness – everyone on the team has to be on guard of situations and circumstances. No one likes to think about those, but afterward it is too late. Every member of the organization must know what their role is within the security program and they HAVE to do their part.

There’s a quick list of security considerations – there’s a lot more out there, but the key question is “what does your program look like?” After any incident, the program needs to be revisited for its viability. After a tragic incident – well, not having a program in place just doesn’t help the situation in any form or manner.

For the Storeroom these same initiatives apply, but it is just parts and not someone’s personal safety. Taking time to ensure the Storeroom has identified basic security policies; put a program in place, and act upon those is a great start. The critical component to success is to adjust the policies as necessary to allow for access while maintaining control.

 

September 29, 2014

3 Key Tactics for 2015 Maintenance and MRO Budget Setting

It is the last days of September and suddenly 2015 is not so far away with many of us already hard at work on 2015 budgets. Determining next year’s budget is always such a difficult task. Everyone knows that productivity is expected – and you may feel like that means “do more with less”.

Setting the maintenance and spare part budget can be really challenging for the team and organization. After all, we just don’t know all the possible problems to be encountered with our equipment. Because maintenance labor and spare parts expenditures are so large, many organizations often cannot help but give significant improvement targets to those accounts. Many opportunities to improve the efficiency of both accounts are well-deserved, but tactics and strategies are necessary for success.

As a manager of a large organization, setting productivity targets can be daunting and even be subject to much controversy. Some may leverage a compression model which decides to squeeze all members’ budgets within the organization by an equal percentage with then let the members decide how. Some may decide to rank by opportunity and search for greater budget reductions from those with the greater opportunity. While a few tactics may be thrown out to the group to justify some of the improvement, most managers are on their own to determine what else to do.

Other organizations may seek input from within the organization to create a plan based upon known needs, better methodologies, and provide some available funds for emergencies. That approach is usually better received by all, but takes some more time and effort on everyone’s part.

The more successful budget-building approaches utilize three key tactics:

  • Zero-based budget
  • Detail the “known details”
  • List the value improvement in SOP’s, processes and technology

Zero-based budget – this approach signifies a fresh start and creates an open conversation about what and where to spend. It doesn’t quite ignore the historical spend, but does communicate to the organization a different mindset. The next year’s budget starts with $0 and adds the known probably expenditures with some money budgeted for unexpected repairs.

Detail Known Budget Expenditures – this tactic should be comprised of PM’s according to the annual schedule, rebuild work on bigger components, seasonal repair work, equipment with eminent failures, expected service calls and repairs. Be sure to review from multiple perspectives and multiple times for accuracy. Additionally, some new PM’s may be required so be sure to allow some “seed” money to find the right amount of time and spare parts for the implementation.

As part of this tactic it is prudent to review the work history and spare parts purchases for indications of work to budget for 2015. This also helps reinforce accurate use of the CMMS if the end users understand inputted data provides the means to determine the next years’ budget. A sample data review for accuracy helps our process – for example, if our inventory accuracy is 95%, then we likely have not captured 5% of the spare parts issued. Accounting for the inaccuracies can help, but will be limited in full effect since the magnitude of errors may be well buried in the data and details.

So, overlaying all the current year work for the next year as a requirement for the new budget is unrealistic. However, there will also be unforeseen repair work requiring financial resources just as was the case for 2014. Leaving some unallocated funds in the new budget to meet those repairs is a great insurance police against those unknowns and acts as an emergency fund just like at home.

List the value improvement in SOP’s, processes and technology – this tactic should be the actual productivity value because of better methodologies in the equipment repair program. Unless each methodology will be underway on day one of the new fiscal year, it is important to allocate a portion of the year that the value will be realized. For example, if a new predictive pm program is slated to be in place on July 1 of the next year with the fiscal year starting on January 1, then 50% of the annual opportunity should be realized with a carryover effect into the first six months of the next year. It may be great to realize we have some better methods started at the end of this year which will have some positive impact upon the first part of 2015 as well.

In all, the value improvement actually reduces the amount to budget since our team will be more effective. Most of our teams will spend 100% of the budget, but it is a great strategy to leave some flexibility for delayed implementations or over-estimations of improvement. That leaves under-estimations as upside to productivity or can offset unforeseen situations which were not included in the budgeting process.

2015 Budget setting is not a task to be taken lightly because of the organization impact. Use these three tactics where possible to put known information together while leaving some latitude to address the unknowns certainly can help ensure success. When organizations push reduced budgets with undetermined tactics and minimal room for unforeseen situations, the financial risks and trade-offs’ become a source of great frustration for all.

Productivity is part of that continuous improvement culture an organizations needs for sustained long-term effectiveness and market success. The overall message remains clear for all of us – ongoing implementation of better methods, processes, and technologies is required for a successful 2015.

September 15, 2014

Maintenance and MRO Cost Reduction

I saw a recent forum post topic that started with “To reduce maintenance cost, you need to focus on maintenance cost reduction – What is wrong with this approach?” It certainly prompted lots of subsequent posts and it had absolutely hit a nerve with many maintenance professionals. Terrence O’Hanlon of Reliabilityweb.com posed the question and I believe he challenged folks to engage in the discussion. The topic is especially appropriate now as many organizations are setting financial budgets for the next year.

So, here’s my take in the topic conversation to an even further extreme – Maintenance costs could be $0, but…..

  • Equipment part components don’t last forever.
  • PM programs sometimes fail at lubrication.
  • Equipment operators don’t have SOP’s or have SOP’s which promote equipment lifecycle longevity
  • Equipment failures represent unacceptable safety, quality, environmental or cost consequences.
  • Customer service is so important that failure to deliver is not optional and every precaution possible is needed to eliminate risk.
  • Equipment replacement costs outweigh any gains to no maintenance costs.
  • We don’t understand how the equipment works or maybe how it works to achieve zero mechanical downtime.

So, because of all those factors our maintenance team costs won’t be $0. What are we then to do? It is my belief that maintenance costs will be exactly equal to the quality of the equipment operators’ care in operation, the preventive maintenance program care, and the longevity of the equipment’s design and components. To improve we must tackle those listed indicators and remember that doing the same thing repeatedly and expecting different results has been cited in history as a definition of insanity.

Operational care is one facet of the equipment’s lifecycle that varies dramatically from one operator to another. After all, it is a function of the personal make up of the operator and ALL are different. Automobiles are a great personal example out in the world. We all have witnessed people who “babied” their car better than family – cleaned regularly, covered, and only asked to perform occasionally. Others are there to test the limits of what an automobile can do knowing that “we can always get another one”. Ultimately, if we have SOP’s in place, then we can begin to bring a little more consistency and reduce the extremes at both ends of the operational curve.

A critical consideration to achieve operations excellence is to match the equipment to the expected result with a fair amount of wiggle room in its capability. One example may be to have SOP’s which set the equipment to run 80% of potential output consistently knowing that wear and tear are reduced. Once we do that, however, a lot of folks start doing the math of what does 5% more get us in output versus costs and so it begins. The key is that the folks who ultimately make the decision are accountable for the final outcome. Unfortunately, in today’s world those decisions are made and people making them move on and don’t have to live with the consequences.

Preventive Maintenance Care Programs can really take known potential defects and address them. The problem often is that we don’t know what we don’t know. Manufacturers can give us recommendations on lubrication schedules, adjustments, and check-ups, but with the consequences hopefully so far down the road it seems a matter of blind faith. Other customers of the equipment manufacturer may be great sources to share and learn the details of what worked and provide some missing insight.

Finding alternatives to the most expensive cost associated with the equipment should be ongoing. A defined process for testing and verifying solutions is absolutely essential to successful implementation. The faster this process becomes, the more proficient the preventive maintenance program can be. Sourcing alternative maintenance methods and verifying the expected improvement is a great counter to expensive and failing current practices.

Improve the equipment design and longevity of its components is another ongoing endeavor which can really make a difference in that cost curve. Want a great example? Look again at automobiles. More than one “new” model had some significant flaws, but as soon as the first ones were manufactured the process of improvement and refinement began. Like the PM care program, the identification of alternatives, the validation, and ultimate transition to better methods move the equipment and component performance forward.

Human ingenuity is incredible, but expectations and commitments of leaders and even an organization can get in the way. The people side sometimes believes that if there is not a hard and fast expectation to remove this or move that forward, then it just won’t happen. The individuals who create that organizational chaos really believe without significant challenge and impetus human nature is to do nothing and live with the status quo.

There’s some truth baked into that argument, but realistically people rally around what becomes important to them. Artificially creating importance through budget cuts and reductions only serves to create longer term resentment. The best teams take a positive approach, make it fun, or even create a contest to achieve milestones. Those, whom are successful and even those that aren’t with that positive approach, willingly tackle the challenge over and over again.

So, the reality is that maintenance cost reduction efforts are infinitely possible only as long as we are willing to challenge what we do now, how we do it, and implement better alternatives.

 

September 7, 2014

Guide to MRO Spare Parts Storeroom Safety

Safety – we know it is the most important consideration for our staff’s well-being. Living and working with safe practices every day can be challenging, but we have to make every effort to prevent questionable situations and practices.

Our storeroom staff works hard and has great intentions in what they do. We have to keep our inventory storeroom practices front and center of our folk’s attention to avoid exposure to electric shocks, sprains, strains, bruises, or cuts.

5S practices as we have discussed in previous posts can help prevent some of these unsafe situations. Auditing and sustaining the established practices are a key requirement for long term success both for 5S and reducing safety risks.

Here’s a quick list of some situations and practices to consider – there are probably many more, but wanted to jump start the conversation about our folk’s well-being.

  • Don’t store parts on top of cabinets – this practice is not good for parts and presents a real potential for the parts to fall or be mishandled and cause an injury.
  • Have heavy item movement strategies – Many storerooms are located above the maintenance shop – have a simple means to move heavy items and not carry them. Elevators or forklifts should be the preferred method. If there is an absolute need to carry a heavy part upstairs, then team up with a partner to carry the part. Also, some heavy-duty motors are larger than a 4-way pallet. It can be a reasonable protocol to have a spotter walk along side as the part is moved with a forklift to ensure clearance and potential obstructions in the path are noticed by the driver.
  • Know the recommended weight limits – both floors and storage units have limits which when exceeded can have catastrophic consequences. Wood floors on second level storage areas are a great concern as the structural support may not be there for anything which could exceed the weight of your home refrigerator. Heavy motors, pumps, and gearboxes on light weight shelving can also be a recipe for disaster when least expected.
  • Put lighter items on higher shelves – filters are a great option for taller shelves especially for shelves four feet above the floor. Access to rolling stairs can be helpful for easier storage and retrieval.
  • Know that some parts can pack a punch – some of our parts have moving parts like gearboxes and others if not handled properly can create electrical shock like inverters or capacitors.
  • Don’t pile parts – unsecured pallets, floor, desks, tables, etc. are poor storage areas to prevent damage to parts. These methods of often temporary storage can also become like a house of cards waiting to fall or collapse onto someone’s foot or become a trip hazard.
  • Keep and lubricants and solvents secure – these are items which can create a slip potential hazard and/or fire hazard. Again, it is important to consult MSDS (material safety data sheets), manufacturers, vendors, and safety regulations.
  • Clean the floors – avoid the trip hazards with no clutter and remove slip hazards through grease/oil removal routinely. Floor scrubbers can make a huge difference to complete this task done quickly.
  • Eliminate the fire potential – our storerooms have lots of materials which can be flammable or worse. Storing all materials in accordance with safety regulations, manufacturer recommendations, vendor input, etc. is a must.
  • Secure storage racks – some racks are more heavy duty than others so please remember they can become top-heavy if not carefully planned. Bolting storage racks to walls, the floors, and even each other can help avoid a potential disaster similar to what is seen in movies where a number of racks can fall much like dominoes.
  • Check on the staff regularly – most of our team likes to operate independently, but health issues do occur and tragedies can happen such as heart attacks, strokes, or seizures.
  • Sharps disposal policy – safe disposal of knife blades and other sharp objects is critical to avoid serious cuts. Remember that a sealed container with a depository slot can be a great option.
  • Lighting – have enough lumens in the storage areas for easy visibility. It prevents tripping hazards and improves identification of spare parts. Automatic shutoffs for lighting are acceptable to manage electrical usage, but sufficient lighting for the team is mandatory for the team’s safety and proficient task completion.

As mentioned previously, this list is a starting point and your team probably has many others to consider as well. Storeroom safety takes a number of practices to ensure everyone’s well being. Failing to do so puts our team at risk.

August 28, 2014

Three Quick Tactics to Start MRO Inventory Prevention

Last week I read an engaging blog post by Phillip Slater of Spare Parts Know How about Spare Part Inventory Prevention. The primary points I gleaned from the post were that inventory optimization doesn’t work and most folks don’t talk about inventory prevention. I greatly respect the author and appreciate initiating inventory prevention as a discussion topic. There are a couple of additional points which seem very important for consideration. So, I wanted to share some additional perspective about spare part inventory prevention.

Spare parts are a fundamental requirement to make most permanent repairs to equipment. Without spare parts, equipment repairs are often temporary in nature and reduce operating efficiencies. That said, some of those parts can be ordered and installed while other parts really need to be kept on hand for a variety of reasons usually related to ease of availability.

When it comes to MRO Spare Parts inventory, that inventory is a means to ensure the greatest chance of success for the equipment operation in many difficult scenarios. Unfortunately, as Phillip pointed out in the post, several forces are at work which tend to drive the inventories up and up. It almost takes an “intervention” type endeavor to get enough support to make a change to those forces. Also, we really need to explore those forces and how we gain control of them at each storeroom.

Maintenance Managers, in my opinion, have one of the most difficult roles in any operation. They can become involved in almost every issue, initiative, and solution when it comes to an operation’s efficiency, safety, quality, capital projects, etc. It is very challenging to engage any Maintenance Manager in a prolonged spare parts inventory discussion because they have multiple priorities rolling out their ears. My experience is not that Maintenance Managers are not willing to support a MRO inventory process review – they are not recognized for those efforts in almost any way. They do get recognized rightly or wrongly for how equipment performs so getting access to a more effective spare parts program can be well worth their while.

I believe there is lots of conversation about inventory prevention in just about any organization and even touched on the subject last week on MRO Guy Podcast episode 009. I just find there are a lot of good folks on our teams who don’t know what to do to prevent spare part inventory growth or lack the local support to do so. In episode 009 of MRO Guy Podcast we discussed the issue of budget accountabilities and non-usage accountability – meaning there is lots of scrutiny on buying spare parts, but not on what gets used.

Good, quality Vendors know their business relationship with you is based at least in part on getting you better results. The issue is that in our busy schedules we forget to ask “what can you do for us?” enough times to these folks who are in many respects business partners. If vendors win today because they sold you something and don’t care about the results, then you have the wrong vendor – go find another.

As for inventory optimization, it can be a “buzz word” thrown around pretty freely sometimes – it really should be called “inventory adjustment process to fit the business needs.” Inventory optimization does have some very specific flaws in that it utilizes a “rear view mirror” approach to inventory level setting and decision making. It leverages historical data which can be faulty due to poor data quality or it overlooks the underlying circumstances such as a PM program failure or an operational issue which skewed the data. With that stated, I do have to share that even with all those flaws baked in, inventory optimization practices are much better than what I see many storerooms utilize which is generally NOTHING. Again, it results from the function of multiple priorities for the team and their intention that we will eventually get around to having an inventory level setting process in place. My point is, while not perfect, inventory optimization is significantly better than what most storeroom and maintenance operation are doing now.

The other takeaway on the topic of inventory prevention was that solutions are needed. I am quite supportive of alternative solutions to the current state. So, when it comes to the subject of inventory prevention, I want to help jump start the conversation about solutions. Here are three that come to mind which are “free” to get the conversation started for you today.

  • Inventory Storeroom Purpose – sounds simple, but there are specific reasons why inventory should be kept. The inventory storeroom purpose should engage various roles and perspectives of the “in-house” customers for accuracy. For example, the purpose of the storeroom could possibly be “spare parts kept on-hand which have purchasing lead times which exceed the predictive failure lead time” as a great fit as well as “spare parts which have significant usage and weekly deliveries are required” since that is all the organization can handle. The benefit to the storeroom purpose is that it can change in the future as needed to better match business needs and situations.
  • Add to Inventory Approval Process – it can be as simple as a piece of paper, but you have to have a means to formally evaluate when a spare part is added to inventory because it is an investment which takes financial resources away from other work which we could complete. That process should include the reasons why it is acceptable for an item to be added to inventory such as long lead time, high usage, limited availability, etc. Those reasons should match the inventory storeroom purpose. It is far easier to guard the front entrance to the storeroom than it is to try to scrap stuff out of the back exit.
  • Identify Buy and Install Items – equipment replacement parts need to be identified and in particular availability from a vendor. If our preventative and predictive maintenance process are worth a hoot, then we should have a wider window for procuring the needed replacement parts. If our vendors provide good service, then we should expect to determine the replacement need before failure, purchase it, and install it. After all, the best use of our budget is to install what we purchase as it does no good for the part to languish in storage for multiple years of time. If our vendors don’t give us good service, then that inventory cost should be a component of the evaluation process about whether to retain the vendor or source another vendor with a better performance record. Where our CMMS allows the creation of a category, it can be quite valuable to create a designation of “order as needed” and not kept as an inventory spare part.

So there you have it – three potential tactics for inventory prevention which are low cost and could be implemented this week. I will share some sample forms next week for the first two solutions under the “resources” tab. Just remember, the conversation and the process are critical components to success – the forms are most valuable only to create a discussion and check point as part of that process.

As you can probably tell, I feel strongly about the importance of spare parts inventory and want to offer some solutions along the way. Spare parts are a major investment for any organization and remain a critical means to make permanent repairs to avoid those catastrophic equipment failures. We just have to make sure we invest in spare parts wisely and efficiently since our available budgets are often very limited.

Bottom line – inventory prevention is a great concept which must include viable processes and tactics the maintenance and storeroom teams can implement to make a difference in performance.

August 14, 2014

More Thoughts about MRO Spare Parts Storeroom Organization

This week I want to go back and cover a previous blog post topic from earlier in the year about Spare Parts Storeroom organization. It just seems very relevant after the last post about 5S and the Storeroom. It is also very relevant since I just finished cleaning out, painting, and organizing our garage at home. I am quite proud to say that it is better in almost every way. When it comes to garages, take look around at the neighbors nearby – how many cannot park even a single car in a 2-car garage? That’s got to be frustrating. I often use the analogy of a garage for comparison to storerooms because most folks can relate to it very well.

There is an old saying in real estate that says “it is often said it comes down to three words – location, location, location.”  Likewise with MRO spare parts it often comes down to organization, organization, organization. I was always told – there is no such thing as too little storage space – it’s a matter of what you do with it. Now, those words of wisdom were imparted upon me by a senior vice president when I was a warehouse manager in a small, complex Plant. I took that message to heart.

Likewise, whether it is the storeroom lay out, accountability’s, or processes those same three words – organization, organization, organization – apply.

When I am in a MRO storeroom it is very telling of the performance just by the appearance and the processes which are in place.  Taking care of MRO parts inventory does not happen by accident – the layout, the accountability’s, and the process have to happen on purpose.  Leave one of these to chance and it can quickly become a huge mess.

Storeroom staff has to like to work in an environment which is well organized.  You can often tell much just by the appearance of the storeroom attendant’s desk and I am not talking about the occasional pile of paperwork.  If they are not an organized person by nature, then they probably are a wrong fit in the long run.  Like mentioned previously, a successful storeroom has to happen on purpose and evolve continually to something better.  So what does an organized storeroom look like?

First, it should have specific storage areas designated for functional purposes such as “return to inventory”, “items to send out for repair”, “pre-kits”, “normal storage”, “received items”, etc.  Outside of “normal storage” areas the rest of the group should be temporary in nature meaning that the parts are in a transition in our spare parts process to a final destination.

Second, storage areas must have a designated organizational plan.  The storage area layout should maximize the life expectancy and storage density without risk of damage to spare parts.  A mixture of racks, shelves, cabinets and bins is the common practice to fit size dimensions and weight.  A storage area should protect the parts and not cause safety issues to personnel storing or retrieving the parts.  Do not exceed capability of the storage device and storage area!  Floor capacities should be considered as well to prevent safety and storage issues.  Additionally, electronic components should have an environmentally controlled storage to control dust, temperature and humidity.  Overall temperature and humidity of the storage room may cause issues with other spare parts as well such as rust for mild steel parts, electro-static charges for sensitive parts, etc.  Your MRO spare parts sales representative can help identify storage issues and solutions.  When spare parts are not in like new condition and ready for use, then that should be a flag for the team to review the entire storage process of that spare part.  Does it need some special storage consideration, how do others store that same part, etc.? Or do we have a bigger systemic problem in our spare part storage processes?  I saw a Plant scrap tens of thousands of dollars of motors and gearboxes because they decided to store these parts in a raw material storage area that required 100% humidity – talk about a painful situation – that one certainly was when all the parts rusted in less than six months.

Third, have a naming schema for the storage locations.  Storage location identification should include in the form of words, letters, or numbers for rows, drawers, drawer positions, shelves, areas, etc.  There must be an overall plan which is known by all and systematically followed.  For best results, I suggest a schematic drawing which reflects the organizational pattern for all to know.  Also, remember the implications for your CMMS…a lot of typing of location inputs can be difficult especially if punctuation is included.  CabinetRow-AShelf5-Drawer4-Slot3 would be much easier to key into the CMMS as “A050403″ if the entire staff understands that terminology.

Next, clearly label everything.  If your CMMS prints labels, take advantage for easier labeling of spare parts locations and even consider tagging a label on the part for easy identification when out of its normal storage location.  This practice can also help folks know where to return the part to if not needed during a scheduled work repair.  Hand labeling is time consuming and offers no shortcuts when reorganizing.  If the CMMS system does not print labels, then consider another labeling program which could help with easier editing capabilities.

Lastly, like we discussed last week, you have to audit for compliance.  Plans are great, but it is the execution that counts.  Does everything have a place and is everything in its place?  A simple audit method may be to include as part of the cycle count process.  Check to see the items are in the right drawer, etc. and that nothing is sitting on top of a cabinet without a home location.  If the service level goal is 99% or higher, then you have to have at least 99% of the spare parts in their designation locations – otherwise it just doesn’t work for the team.

The bottom line – have great storeroom staff working in an organized environment with specific processes and the chance for success is much higher.

 

August 4, 2014

MRO Spare Parts Storeroom and 5S

In a recent MRO Guy Podcast interview with the folks at eMaint the topic of 5S surfaced as a means to gain control over the MRO Storeroom. It seemed appropriate to delve a little further into what 5S is and its value to the MRO spare parts storeroom.

5S is a great approach to make a visible and unmistakable change to a spare parts storage area as well as create a better work environment for all. 5S is part of the Lean manufacturing principles in the Toyota Production System.  Taiichi Ohno was the chief engineer for Toyota who put the concept in place just after WWII. Conceptually, the TPS focuses on process flow and removing of waste along the way whether actual physical waste, waiting, etc.

5S engages people through the use of standards and discipline. 5S is not just about housekeeping, but it also concentrates on establishing standards and then creating the discipline to manage the organization. It is all achieved through a respect for the workplace or Gemba every day. 5S relates to workplace organization and forms a foundation which many organizations base their drive for continuous improvement. It is equally applicable and successful in all business sectors helping to achieve more impactful results.

5S is a systematic and methodical approach for teams to organize a storeroom or workplace in the safest and most efficient manner. The discipline to check and repair equipment is included and adopted. The entire process is managed through the use of team generated audit documents, completed on an agreed frequency by responsible owners within the workplace or Gemba.

5S Consists of the Following Steps:

  • Sort – Sort out and separate that which is needed and not needed in the storage area.
  • Straighten – Arrange items which are needed so they are ready for easy access and use.
  • Shine – Clean the area and equipment on a regular basis in order to maintain and identify defects.
  • Standardize – Revisit the first three steps of the 5S on a frequent basis and confirm the condition of the workplace (Gemba) using standard procedures.
  • Sustain – keep to the rules to maintain the standards and continue to improve each day.

 

What are the Benefits of 5S:

  • Improved safety since unsafe storage conditions are removed
  • 5S becomes more of a fundamental business process and key driver for Kaizen type events
  • Forms a solid foundation upon which to build a continuous improvement culture
  • Employees gain more of a sense of ownership, involvement and responsibility
  • Reduction in inventory waste and waiting which are part of Taiichi Ohno’s seven forms of waste
  • Improved performance in productivity, quality and even morale which leads to increased business profitability

For the MRO storeroom, 5S should be approached in an organized fashion focusing first on a small area to first understand the process and then progressively moving through the rest of the storage areas. The team must be on-board with the approach, the expected benefit, and their role in the change and sustainment. It may be very beneficial to take some before and after photographs for the team to visually understand the transformation leading to a better storage facility.

Overall, 5S is an awesome tool with excellent benefits which help gain control of a MRO spare parts storeroom and create a positive change for equipment repair processes.

Could your team leverage 5S as a great opportunity for a positive MRO spare parts storeroom change?

Thank you to the Kaizen Institute for providing some great details to share.

July 20, 2014

MRO Spare Parts Reference Books

We are often asked what reference books can help develop a better understanding of MRO Spare Parts and Equipment Maintenance programs.  While each person may find a different author’s style which appeals to them individually, the core material should provide relevant concepts and a call to action for improvement.

The following books are on my book shelf and recommended as references for better MRO Spare Part and Maintenance efficiency.  Each is unique in the author’s style and provides a challenge to think differently about spare parts and equipment maintenance through detailed approaches and action plans.

The opinion and reviews stated are for informational purposes only and each reader should make their own value judgment of the information related to their specific situation.  Should you choose these books via our link, we thank you for your purchase.

http://thesblgroup.com/recommended-reading-list/

Recommended reference books:

  • Maintenance Strategy Series Volume 2 – MRO Inventory and Purchasing by Terry Wireman;  The second volume in the series, MRO Inventory and Purchasing, shows the reader how to develop an inventory and purchasing program for MRO spares and supplies as part of an overall strategy. Specifically, this book focuses on the importance of a well organized storage location and part inventory numbering system detailing some effective ways to accomplish this goal. The receiving and parts issues disciplines are discussed in detail with a focus on the value proposition for spare parts controls and justification of storeroom overhead.  The appendices provide excellent examples of parts and detail storage conditions which can be utilized in developing or refining an inventory storage location.

 

  • Lean Maintenance by Joel Levitt;  Written for anyone in a leadership position in maintenance, storeroom or production.  A practical book which helps tie maintenance programs and spare part programs together.  Helpful information to uncover waste, design projects to address the waste, sell projects to management and deliver project results. Every area in maintenance is covered, including TPM, storeroom, PM tasking, work orders and computer systems.  Can help start the process of saving money, energy, or time pretty quickly. Good examples at every step of the way to guide the reader.  Includes forms and check lists for successful Lean projects.

 

  • Audel’s Managing Maintenance Storeroom by Michael V. Brown;  This book would make a great workshop basic user’s guide.  This book shows how to plan, equip, stock, catalog, and manage a storeroom which benefits both workers and the company. Shows some cost-effective ways to maintain essential stock, how to conduct audits, and some ways to negotiate better prices.  Includes:  practical site, storage, lighting, and security; plan needed parts, when they should arrive, and how best to catalog them; set standards for balance quality and price; plan an efficient physical layout and organize storeroom to balance space limitations against shelving cost; establish an inventory systems and processes; details about purchasing laws, contracts, warranties, and ethical practices; 

 

  • Smart Inventory Solutions: Improving the Management of Engineering Materials and Spare Parts by Phillip Slater;   “Dedicated to help get the right parts, in the right place, at the right time, for the right reason.”  This book covers managing engineering materials and spare parts and what to do to improve results. It includes examples and case studies to demonstrate the application of the concepts and ideas.  The books details topics like: optimize inventory holdings; reason for high inventory levels; identifying factors with greatest impact on  inventory levels; when to apply the Actions for Inventory Reduction; where to focus your efforts for greatest effect; and who to involve in taking action.  Additionally, the book includes several checklist and a great glossary of terms.

 

  • Maintenance Storerooms and MRO – Made Simple by Daniel M. DeWald;  This book treats maintenance storeroom is a key department in a facility. The book approaches the storeroom as a profit center which supports Preventive Maintenance (PM) and Predictive Maintenance (PdM) efforts.  It details parts for emergencies and unexpected breakdowns; improving reliability for maintenance by the purchase and storage of quality parts; equipment Bills of Materials; and integration with the maintenance strategy.  Key to the conversation are five strong pillars needed to develop a program of MRO (Maintenance parts, repair parts, and operating supplies) and the maintenance storeroom: Storeroom Management; MRO Buying and Purchasing Management; Inventory Management; Supplier Management; and Work Processes. Central to the pillars discussion is the CMMS – Computer Maintenance Management System and a recommended Enterprise Resource Planning (ERP) system which includes all plants and common part numbers.  The author promotes a solid process base to move forward to reliability excellent storeroom which is responsive to the needs of maintenance, the Plant, and the enterprise.

 

July 8, 2014

MRO Guy Podcast

The MRO Guy Podcast has been launched to offer another means of sharing information and details about spare parts management and equipment reliability programs.

Each episode we unpack some more information about equipment repairs and spare parts programs for you.  Whether you are in manufacturing, warehousing, or a building facility, we want to help you access more information along the road to World Class levels of equipment reliability.  Many of you may have an average spare parts program which means the budgets don’t go far enough because of low inventory turns, lots of out of stock parts, and a high number of unused spare parts – that’s an opportunity to do something different and that is what our podcast is about each episode.

Hey, I am super excited to announce that the MRO Guy Podcast can now be found on iTunes and Stitcher for those wishing to download the podcast.  Please consider giving us a review – any 5 star reviews help us get on the new and notable page of the business news category which is pretty competitive these days.  Also, “thank you” for all the feedback over the past couple of weeks as our podcast has kicked off.  Please keep the feedback and questions coming as it helps us progress further.

World Class Reliability does not happen by accident – the podcast is focused on getting things done. World Class is a premier level – it is difficult to achieve and takes a dedicated effort, but the impact to the organization is truly a change in the quality of work life. Whether you are located in a manufacturing Plant or building facility the equipment maintenance programs are what people count on to know the equipment will perform in a predictable fashion. Yes, we can ignore the equipment or spare parts processes, but then it is just like your car and the old commercial which says “you pay now or you can pay later”.  The equipment maintenance processes just don’t go away.

As such, you can have the best repair programs around, but if your spare parts programs are not equally as good, then equipment failures are very likely to happen and frustrate everyone on the team. That is why we will be talking in depth each episode about topics key to reach that elusive World Class level of Reliability results.

Here’s the link to the podcast on mroguy.com as well as the link on iTunes:

 

June 9, 2014

Grab the Value of Spare Parts Failure Analysis

The mechanic simply replaced the failed part with a new one and then disposed of the old part.  It happens every day.  So, what’s wrong with that?  Nothing other than an often overlooked tool available to most maintenance teams is failure analysis of a spare part.  It generally is not intentional – just a function of busy schedules with lots of priorities.

Spare parts do fail; however, there is almost always a reason behind the failure if we take the time to do a little investigation.  With all the other priorities taking place it can be difficult to tackle as it is often viewed as a “non-value added” exercise with little to be gained.  Even though Sherlock Holmes is not needed, about thirty minutes of time and some well targeted questions while the trail is still warm can help solve the case.

The failed spare part can provide lots of clues about its life cycle and the actual performance of the maintenance and reliability processes.  Does it really?  Yes, it does.  For example, mean time between failures (MTBF) is measured through data gathering such as this and indicates what to expect.  It also lets us know when something fails prematurely.  It can also indicate the payback of investments in better spare parts or maintenance if the MTBF gets longer.

Here are eight questions which help with the investigation process of a spare part failure process:

  • When was the part failure first recognized and did we have spare part available?  It can be worthwhile to determine the leading indicators of the failure for future reference and prevention.  Knowing the last possible indicator can also help to determine if predictive maintenance methods (PdM) could identify the issue prior to complete failure.  Certainly identifying the failure prior to shutdown can help us reduce inventory since we can order and replace before failure.
  • What was the cost of the failure to the business?  The impact of a failure can determine the level of means worth pursuing in failure prevention tactics.  If the cost to the business is $1, then it may not be worth pursuing preventative measures; however, a part failure resulting $1 million in business impact could mean all available options to prevent the downtime should be pursued.
  • When was the part last installed and was it installed properly?  This may be an indicator of the life cycle of the part if it matches up with other MTBF (mean time between failures) for the same or similar part.  However, even then it can be a question of whether it was premature failure or not.  If the failed spare part was not installed properly, then it can become a teachable moment for the entire team so that the failure can be prevented in the future.  If one person did not know how to install properly, then there are likely others who don’t know as well.
  • Does the failed spare part have a PM check?  It may be okay that it does not, but we need to know whether it exists and just as important is it up to date?
  • Does the spare part require lubrication and is it up to date?  CMMS records may provide some information regarding lubrication schedules and completion so be sure to look there first.
  • Does the spare part show wear or damage?  This can be another indicator of lack of lubrication, alignment, vibration, etc.  If there is an indicator of mechanical damage, this is a great opportunity to add to a PM inspection or PdM check particularly to prevent a future catastrophic failure.
  • Was there peripheral damage to other parts when the failure occurred?  This can be another indicator of misalignment or vibration as part of a catastrophic failure.  It may be another component that is getting ready to fail and this spare part went first.
  • Can our supplier/vendor help determine the cause of failure based upon their expertise?  This could be a great opportunity to view it from another perspective as well as get suggestions for improved alternative parts for greater longevity.  Our suppliers can be overlooked for their experience with many other customers’ situation which could be similar to ours.

Armed with all this information, the analysis now trends toward what are the actions which we could have taken to prevent the downtime altogether.  If not an avoidable issue, then the follow up question could be “how do we control the situation for better future results?”  Often that answer can be a change to a process check, PM, installation process, or even a heavier duty replacement part.

Gathering the data, doing some root analysis (RCA), and then resolving to eliminate that root cause (RCE) results in a process or program change leading to better results.  Also, this is a great opportunity to search out replication for other equipment/part components.  We will want to be sure to capture the findings in the CMMS for future reference especially during off-business hours when skills and experience may be less.

If we can complete this process in about 30 minutes or less, then the team can be very effective in finding alternatives to a “fix it when it broke” approach which defines “reactive state of equipment reliability”.  How can your team put this tactic of  “spare part failure analysis” to work for them?

 

May 2, 2014

MRO – The Hidden Costs of Spare Parts Inventory

It is frequently seen.  A manufacturing Plant or Facility takes on a new inventory item.  Often that decision is based upon an event or happening so impactful to the business that someone on the local team determines a replacement spare part should be stocked.  Once in inventory, it is deemed “paid for” and now just thought of as an insurance police for the “next time” the component spare part fails.

Unfortunately, that stocking decision becomes just the start of a trail of expenses and costs.  How so?  Well, the very fact that the spare part is now a stocked item took away from the purchase of another spare part for a corrective work task or repair.  Now, that missed purchase will eventually be made, but placing spare parts into inventory certainly diverts highly desired budgetary resources away from those “purchase to fix it” situations.  If that “fix it now” situation is severe enough in risk, then the inventory purchase may have just contributed to a catastrophic failure around the corner.

Additionally, most companies seek 12% to 15% return on investments.  A $400 spare part purchased and not used takes away up to $60 in capital returns because it just isn’t going to generate any savings or cost benefit.  Again, with scarce capital available at times this $60 example when multiplied times a hundred or a thousand takes on significant values of unrealized capital returns.  Most storerooms will find less than half of their inventory is ever used so this value can exceed hundreds of thousands of dollars not to mention the loss of the original purchase price.

Labor costs are often over-looked as a cost of MRO inventory, however, it is quite real.  Too many storeroom tasks to accomplish?  Too much storeroom overtime labor spent?  All the inventory kept on-hand drives counting requirements, storage, labeling, organizing, etc. which does not count toward issuing the spare part that may never happen.  Most organizations find a carrying cost of 5% to 10% for these activities.  Without the excess inventory, then less activities and less staff costs can certainly result.

Facility costs are another overlooked cost area.  This is mostly because the building is seen as fixed overhead cost and if the spare parts storeroom was not there, then what would be there?  Regardless of the other alternatives, heating, cooling, and lighting expenses are incurred for that area.  If no parts were there, then the utility costs would not be needed or at the very least significantly minimized.  Most Storerooms find an energy cost of about 2% to 5% of the spare part just to maintain the area for these costs as well as storage expenses for racking, shelving, etc.  And at about $400/square foot for new construction, expanding a storeroom for greater space can even be substantially more.

So when adding up these areas of hidden expense, it generally will be somewhere between 25% and 30% of the actual item year after year.  While not every cost could be eliminated, the argument does surface that the costs would be drastically reduced.  So a $1 million worth of inventory not used can generate the better part of $250,000 worth of unrealized value elsewhere in the organization.  This impact is even outside of the original expense to purchase the spare part by itself.

Thinking through the spare parts inventory alternatives is imperative to get the most out of every dollar in the financial budget.  But in reality the purchase can be the tip of the cost iceberg because of hidden associated expenses.  Do that purchase routine ineffectively for multiple years and the hidden cost value can surpass unimaginable expectations.

Have a thorough review process for spare parts additions to inventory and know the impact to your business’ bottom line.

 

March 7, 2014

Why Is MRO Inventory Accuracy So Important? 

Inventory accuracy can be over looked for its influence not only on the spare parts inventory, but also the repair work needed.  The repair work impact may seem a stretch, but it is an exercise in probability.  When planning repair work for an organization, the maintenance staff really does not complete a probability analysis.  However, some activities like double checking the available spare parts in a drawer or cabinet location may actually be a tactic to offset known inventory accuracy deficiencies.

Inventory accuracy in its basic terms means that a maintenance staff member went to a storage location and the stated inventory did not reflect the same quantity or condition as the CMMS.  That process may be in the form of a cycle count (inventory verification), pre-kit, or emergency repair issue.  The resulting impact is the same – lack of spare part to complete repair work. 

Team member frustrations can swell enormously when this KPI effects their respective work assignments with inadequate spare part availability.  Unfortunately, that impact is team self-inflicted.  Inaccurate spare parts check-in/check-out is responsible for the missing spare part issue in almost all cases – that is controlled by the team compliance to inventory spare parts processes. 

This situation is most troubling for the organization when emergency repairs are needed as flexibility in procurement may be limited.  Such emergency repair situations stress the organization to its limits to complete a temporary fix, procure the needed part or both.  Repair work requiring multiple spare parts magnifies the inventory accuracy spare part implications on the probability of completion.  The difference between 99% inventory accuracy and 90% inventory accuracy for an emergency work order repair by number of parts required is demonstrated in the following illustration.  99% inventory accuracy is considered World Class Reliability program level (WC) and 90% the accuracy of a more typical storeroom inventory.

Inventory Accuracy Impact on Probability of Completion

Emergency W.O. Impact           WC               Typical

  • Work Order – 1 Part                99%                   90%
  • Work Order – 2 Parts               98%                   81%
  • Work Order – 3 Parts               97%                   73%
  • Work Order – 4 Parts               96%                   66%
  • Work Order – 5 Parts               95%                   59%

In the above illustration each additional spare part availability or probability for success is multiplied by its reflective inventory accuracy.  Therefore, a 99% inventory accuracy storeroom (WC) the work order with two spare parts required would equal 99% times 99% for the probability of completion result of 98%.  This result is still quite high for the chances of completion and will likely not take away from the Reliability program’s performance results.   

For the 90% inventory accuracy storeroom (Typical) the same two spare part corrective work order equals 90% times 90% for an overall 81% probability of completion.  As indicated on the illustration, more spare parts involved with a work order seriously decrease the probability of successful work order completion and creates that potential catastrophic situation for the organization once again because adequate repairs cannot be made. 

The organization can make significant improvements to this KPI through a number of processes and process checks listed below.

Improving Inventory Accuracy

  • Secured Storeroom Area
  • Defined Check-in & Check-out Processes
  • Routine Cycle Counts by Spare Part Priority
  • Daily Follow-up on Work Order with “replace”, “repair”, “re-built” , etc. as tasks

It is critical for the maintenance and storeroom staff to remember that the team owns 100% of accuracy results.  Equally important their compliance to the processes and task for improving inventory accuracy is required for improvement.  Leadership must reinforce the critical nature of storeroom and inventory practices to maintain focus and compliance. 

February 21, 2014

Enabling Reliability Results through MRO Spare Parts

Whether in a manufacturing Plant or a building facility, Equipment Reliability Processes and MRO Spare Parts go hand and hand.  One is really difficult to exist without the other.  Repair work without spare parts is a “make do” process at best and spare parts without a purpose is simply wasteful spending.

Beyond that comparison, the effectiveness of equipment reliability and MRO spare parts spending have specific elements for success:

1. Average predicted failure lead time.  Should the maintenance work planning function respond to equipment failures only at the time of failure (reactive work planning), then the MRO Spare Parts spend will not be very efficient as almost all parts will need to be kept on-hand for those “just in case” failures.  The extra spare parts become a “security blanket” and can perpetuate the current state.  Manufacturing Plants and facilities with MRO inventory turn rates of less than 1.0 annually are most likely either in a reactionary work planning state or just recently moving away from it.  How many of the spare part failures on equipment were predicted two (2) or three (3) weeks prior to failure?  The higher the percentage of failures predicted means that inventory levels can be potentially lowered and spare parts ordered just in time for the repair work to be completed before complete component failure.

2. Average Spare Parts lead time.  Maintenance planners will have limited success if for example the spare part lead time from the vendor is four (4) weeks while their predictive failure lead time is two (2) weeks.  The end result for overall lead time becomes four weeks since the spare part lead time is the bottle neck to the supply chain.  This is a situation where the best predictive solutions are still dependent upon sufficient spare parts inventories to overcome the lengthy lead times.  By all means – keep appropriate min-max inventory levels which also reflect spare lead times from vendors.  Additionally, do NOT discount the amount of self-imposed lead time to approve a purchase within the organization.  It sometimes can take a week to get in-house purchase approval before the purchase order is submitted to the vendor.

3.  Inventory Accuracy.  It has happened more than once in most facilities and manufacturing Plants – the spare parts expected to be on the shelf are not there.  Certainly a number of reasons can come into play for this occurrence such as failure to check a part out previously, damaged through poor handling practices, etc.  For the Critical Spares (spare parts critical to the operation), the inventory accuracy impact can be most devastating because of the critical nature of the equipment for the operation.  If the inventory accuracy of the storeroom is 95%, then by all means take inventory accuracy into account when setting min-max set points as well.  Some work planners will take the extra step to ultimately inspect the parts on the shelf prior to scheduling and pre-kitting, however, that process will not help much in emergency situations.  It will not make the issue go away completely, but it does recognize the impact upon work planning and ultimately equipment reliability results.

4.  Staff skill level.  Performance levels often are impacted by the skill level of the staff and it is most notable in emergency situations.  The ability to assess, anticipate, and take appropriate action are reflective of the experience levels of the staff.  After serious equipment failure situations, it is of great value to complete a “root cause of failure” analysis (RCA) to determine the why.  Ultimately, incorporating a process to avoid the future unanticipated failure builds staff experience as part of a Reliability Centered Maintenance (RCM) program.  Ongoing development of people builds program capability and a lack of people skill development process creates potential for haphazard results.

Equipment reliability and spare parts results really do compliment each other for long term results.  One can be successful over the short run at the expense of the other, but after a few years time the site is really set up for a catastrophic failure.

When completing maintenance function assessments, a review of both areas (work planning and spare parts processes) and improvement plans are required for long term success.  Additionally, a cross-functional assessment can shed light on situations which impact the other’s area and get at the truth for improvement and better results.  Equipment Reliability Processes and MRO Spare Parts can be like a successful marriage – the better the relationship, the greater the chance to endure the difficult situations and benefit each.

 

February 7, 2014

MRO Inventory Storeroom Metrics – KPI’s for Success

MRO Spare Parts Storerooms are a huge investment by any organization.  It is critical to determine the effectiveness of that investment.  I suggest looking initially at four specific KPI’s (key performance indicators) as a speedometer for the organization to measure results.  Those four KPI’s are:  inventory accuracy; out of stock; inventory turns; and unused inventory.  These really help create a foundation of success reaching critical levels of performance.

Inventory Accuracy – when completing inventory counts what is the percent of counts matching actual quantity in the storage location versus the expected (CMMS) quantity.  99% should be the targeted performance since this result directly effects the probability of an emergency work order requiring spare parts of being completed permanently.  If the parts are not in the storeroom as stated, then temporary fixes will be necessary with follow up for a permanent repair.

Out of Stock –  number of items with a zero count on-hand divided by the total number of inventory items.  Again, this measure directly effects the organization’s probability to get work completed.  Additionally, if items are not restocked, then the reorder report grows and grows until it is far beyond the budget required to purchase for restocking.  Strategically, if the number of out of stocks exceed 10%, then a serious evaluation of what items can be ordered as needed will be required.

Inventory Turns – inventory value issued divided inventory value on-hand.  Inventory turns of less than 1.0 signify inventory is growing while inventory turns greater than 1.0 mean that we are leveraging inventory quickly.  Higher inventory turns means less unused spare parts.  Remember that items taking years to issue can have major issues with rust, seal degradation, lubricant break downs, etc.

Unused Spare Parts – inventory value of items never issued from inventory divided by total inventory value.  Like inventory turns, it is a measure of how effective spare parts spending is as well as condition of the inventory.  Nothing good happens to unused equipment – condition worsens and damage can occur from mishandling or poor storage space availability.

For Inventory metrics the critical segment is to have an action plan to address the opportunities as well as to ensure sustainment of success.  If you need help with this area, please contact us – we will be glad to help.

 

January 24, 2014

MRO Trade-Off Analysis for New Versus Rebuilt Spare Parts

Rebuild versus purchase new spare parts?  The question occasionally arises in organizations around the trade-off analysis of rebuilt versus new.  The discussion can be difficult, but doing some analysis to determine the best practice and organizational model is very worthwhile.  There are five considerations around establishing the best practice model for your organization:

1. Is a new purchase possible? I have seen a couple of pieces of equipment that a new spare part purchase is not possible either due to obsolescence or lack of a vendor which would mean that a rebuild may be the only alternative.

2. Expected life of the rebuild versus the new purchase. If the new purchase is twice the rebuild, but the expect life is the same, then the rebuild is a worthy consideration and probably saves valuable expense dollars. If the lifetime is substantially less, then it is probably best to purchase new especially with the labor expense to install the parts when failure occurs.  Also, as part of that consideration is the cost of production, etc. for each replacement and component failure – how much per hour of downtime? There’s significant difference between $100/hour and $1,000/hour of downtime.

3. Cost – In most cases, you should expect significant savings for rebuilt such as 50% over purchase of new. The organization should also set the amount for the rebuild limit – parts less than $200 for new purchase are not worth the details of tracking the rebuild process while parts over $1,000 should be considered for the trade-off analysis.

4. Warranty of rebuild and risk of failure should also be considered. If the rebuild has a six month warranty while new has three years with high associated costs of failure, then it is best again to go with the new. Low risk of failure costs and reasonably similar warranties would be better for rebuild.

5. Lastly, consider the proficiency of the vendor doing the rebuild. If the track record and working relationship is very good, then that would provide the organization with some confidence around the rebuild process. If the track record is poor, then the organization will be difficult to persuade on a rebuild. Most mechanics will then take the new part versus the rebuilt one when they don’t have confidence so the savings would not be achieved.

If the process question is about in-house rebuild versus outsource the rebuild activity, then the track record of each should be considered along with time available to complete the work in-house. Unless the component is really better re-built in house from a quality perspective and can be tested prior to installation, then outsourcing of the rebuild process is recommended.

A great resource is the Michael V. Brown book “Managing Maintenance Storerooms” pages 183 to 185 with a great process flow chart on page 184.  Ultimately, the rebuilt versus new decision process can be another great method to add value to the organizations’ expense dollars by making the money spent go a little further.

 

January 10, 2014

Spare Parts Storeroom Organization

With real estate it is often said it comes down to three words – location, location, location.  Likewise with MRO spare parts it often comes down to organization, organization, organization. Whether it is the storeroom lay out, accountability’s, or processes those same three words apply.

When I am in a MRO storeroom it is very telling of the performance just by the appearance and the processes which are in place.  Taking care of MRO parts inventory does not happen by accident – the layout, the accountability’s, and the process have to happen on purpose.  Leave one of these to chance and it can quickly become a quagmire of a mess.

Storeroom staff have to like to work in an environment which is swell organized.  You can often tell just by the appearance of the storeroom attendant’s desk and I am not talking about the occasional pile of paperwork.  If they are not an organized person by nature, then they probably are a wrong fit in the long run.  Like mentioned previously, a successful storeroom has to happen on purpose and evolve continually to something better.  So what does an organized storeroom look like?

First, it should have specific storage areas designated for functional purposes such as “return to inventory”, “items to send out for repair”, “pre-kits”, “normal storage”, “received items”, etc.  Outside of “normal storage” areas the rest of the group should be temporary in nature meaning that the parts are in a transition in our spare parts process to a final destination.

Second, storage areas must have a designated organizational plan.  The storage area layout should maximize the life expectancy and storage density without risk to damage spare parts.  A mixture of racks, shelves, cabinets and bins is the common practice to fit size dimensions and weight.  A storage area should protect the parts and not cause safety issues to personnel storing or retrieving the parts.  Do not exceed capability of the storage device and storage area!  Floor capacities should be considered as well to prevent safety and storage issues.  Additionally, electronic components should have an environmentally controlled storage to control dust, temperature and humidity.  Overall temperature and humidity of the storage room may cause issues with other spare parts as well such as rust for mild steel parts, electro-static charges for sensitive parts, etc.  Your MRO spare parts sales Representative  can help identify storage issues and solutions.  When spare parts are not in like new condition when ready for use, then that should be a flag for the team to review the entire storage process of that spare part.  Does it need some special storage consideration, how do others store that same part, etc.?

Third, have a naming schema for the storage locations.  Storage location identification should include in the form of words, letters, or numbers for rows, drawers, drawer positions, shelves, areas, etc.  There must be an overall plan which is known by all and systematically followed.  For best results, I suggest a schematic drawing which reflects the organizational pattern for all to know.  Also, remember the implications for your CMMS…a lot of typing of location inputs can be difficult especially if punctuation is included.  CabinetRow-AShelf5-Drawer4-Slot3 would be much easier to key into the CMMS as “A050403” if the entire staff understands that terminology.

Next, clearly label everything.  If your CMMS prints labels, take advantage for easier labeling of spare parts locations and even consider tagging a label on the part for easy identification when out of its normal storage location.  This practice can also help folks know where to return the part to if not needed during a scheduled work repair.  Hand labeling is time consuming and offers no shortcuts when reorganizing.  If the CMMS system does not print labels, then consider another labeling program which could help with easier editing capabilities.

Lastly, audit for compliance.  Plans are great, but it is the execution that counts.  Does everything have a place and is everything in its place?  A simple audit method is to include as part of the cycle count process.  Check to see the items are in the right drawer, etc. and that nothing is sitting on top of a cabinet without a home location.  If service level goal is 99% or higher, then you have to have at least 99% of the spare parts in their designation locations otherwise it just doesn’t work for the team.

Bottom line – have great people for storeroom staff who work in an organized environment with specific processes and the chances for success are much higher than without.

 

January 3, 2014

CMMS Data Standardization and MRO Spare Parts

Any CMMS system requires data integrity and the MRO Spare Parts both go hand in hand.  Data cleansing and standardization is a process to convert legacy (existing) data into a format which is consistent and usable.  Consistent means the same format and description styles for all the spare parts descriptions.  For example, believe it or not, consistent spelling can be a problem.  Since many CMMS systems lack security controls, parts descriptions are freely added manually sometimes by multiple system users with the subsequent misspellings left unchecked.

Additionally, verification of manufactures and manufacturer part numbers can have a huge impact upon accuracy and the ability to find the correct part in the CMMS system.  Also, vendors may have a difficult time ensuring spare parts orders match the purchase order to ship the correct parts.  Obviously, if questions arise, then timeliness of the order can become a problem as well.

For a naming format, many vendors may follow a noun-modifier format.  An example may be:  motor, electric, 2 hp, 2850 RPM, 110 VAC Voltage, 56 Frame, Open Drip-Proof Enclosure, Steel Frame Material, 50 Hz Hertz, 70% Efficiency, stainless steel.

Regardless of the format used, the MRO Storeroom team, mechanics, and managers must understand the system requirements.  Once the process and format are inconsistent, then data integrity will begin to erode.  Any discussions about data standardization processes must include sustainability – how are we going to sustain and ensure the data integrity?

One solution to the sustainability may be to keep a master file of the standardized data and then routinely complete a comparison of any differences to the working system.  Another possibility is to limit new part additions to the CMMS system to one or two people to minimize the number of exceptions to the format and process.

Each CMMS system has some limitations on amount of characters for descriptions, available categories, and security levels for data entry.  As with any project, it is recommended to determine the limitations and what works best for the team or company.  If sourcing data cleansing from a service provider (vendor), take the time to understand which CMMS systems fit within their expertise and how the service provider can help.  The financial element (price) of any project is usually apparent, however, the capabilities may provide a better insight to determine the better data cleansing vendor.  You will likely want to get samples and other customer’s feedback about the proficiency of the data cleansing vendor!

Data cleansing and standardization projects can be expensive and time consuming, however, the value to data is very worthwhile to a successfule CMMS and MRO Storeroom.  Without data integrity the maintenance team loses sight of the actual spare parts usages and expenses to maintain the equipment.

 

December 23, 2013

Reliability and MRO Spare Parts

Whether in a manufacturing Plant or a building facility, Equipment Reliability Processes and MRO Spare Parts go hand and hand.  One is really difficult to exist without the other.  Repair work without spare parts is a “make do” process at best and spare parts without a purpose is simply wasteful spending.

Beyond that comparison, the effectiveness of equipment reliability and MRO spare parts spending have specific elements which influence success:

1. Average predicted failure lead time.  Should the maintenance work planning function respond to equipment failures only at the time of failure (reactive work planning), then the MRO Spare Parts spend will not be very efficient as almost all parts will need to be kept on-hand for those “just in case” failures.  The extra spare parts become a “security blanket” and can perpetuate the current state.  Manufacturing Plants and building facilities with MRO inventory turn rates of less than 1.0 annually are most likely either in a reactionary work planning state or just recently moving away from it.  How many of the spare part failures on equipment were predicted two (2) or three (3) weeks prior to failure?  The higher the percentage of failures predicted means that inventory levels can be potentially lowered and spare parts ordered just in time for the repair work to be completed before complete component failure.

2. Average Spare Parts lead time.  Maintenance planners will have limited success if for example the spare part lead time from the vendor is four (4) weeks while their predictive failure lead time is two (2) weeks.  The end result for overall lead time becomes four weeks since the spare part lead time is the bottle neck to the supply chain.  This is a situation where the best predictive solutions are still dependent upon sufficient spare parts inventories to overcome the lengthy lead times.  By all means – keep appropriate min-max inventory levels which also reflect spare lead times from vendors.  Additionally, do NOT discount the amount of self-imposed lead time to approve a purchase within the organization.  It sometimes can take a week to get in-house purchase approval before the purchase order is submitted to the vendor.

3.  Inventory Accuracy.  It has happened more than once in most facilities and manufacturing Plants – the spare parts expected to be on the shelf are not there.  Certainly a number of reasons can come into play for this occurrence such as failure to check a part out previously, damaged through poor handling practices, etc.  For the Critical Spares (spare parts critical to the operation), the inventory accuracy impact can be most devastating because of the critical nature of the equipment for the operation.  If the inventory accuracy of the storeroom is 95%, then by all means take inventory accuracy into account when setting min-max set points as well.  Some work planners will take the extra step to ultimately inspect the parts on the shelf prior to scheduling and pre-kitting, however, that process will not help much in emergency situations.  It will not make the issue go away completely, but it does recognize the impact upon work planning and ultimately equipment reliability results.

4.  Staff skill level.  Performance levels often are impacted by the skill level of the staff and it is most notable in emergency situations.  The ability to assess, anticipate, and take appropriate action are reflective of the experience levels of the staff.  After serious equipment failure situations, it is of great value to complete a “root cause of failure” analysis (RCA) to determine the why.  Ultimately, incorporating a process to avoid the future unanticipated failure builds staff experience as part of a Reliability Centered Maintenance (RCM) program.  Ongoing development of people builds program capability and a lack of people skill development process creates potential for haphazard results.

Equipment reliability and spare parts results really do compliment each other for long term results.  One can be successful over the short run at the expense of the other, but after a few years time the site is really set up for a catastrophic failure.

When completing maintenance function assessments, a review of both areas (work planning and spare parts processes) and improvement plans are required for long term success.  Additionally, a cross-functional assessment can shed light on situations which impact the other’s area and get at the truth for improvement and better results.  Equipment Reliability Processes and MRO Spare Parts can be like a successful marriage – the better the relationship, the greater the chance to endure the difficult situations and benefit each. 

 

December 20, 2013

Inventory Turns – A Key to Storeroom Success

MRO Storerooms could really take a lesson from grocery stores. Grocery store merchandise has to turn to make the store successful.  No one wants to buy older dated milk, eggs, meat, etc.  A key reason is the limited shelf life of grocery items and most of us have had an experience or two with something from the grocery which went bad.

Our MRO spare parts are treated like they don’t have a limited shelf life and will stay just like they did when we received them from our vendor.  Like the grocery items, if someone knew the actual age of two parts in a drawer, the newest one would always be selected for use.  Strange how we all make the connection between newer in date and the likelihood of meeting our expectations regardless of the environment.

One key difference for the grocery store is the fundamental concept of inventory turns related to their purchasing decisions.  Something which fails to turn will move to the dumpster, back to the vendor, etc. depending on the purchase arrangement.

A funny story a friend told centered around his experience at a grocery store where he worked in college.  He worked in the meat department and a monthly inventory was required.  He questioned why there was a swordfish in the freezer which was several years old.  Apparently the swordfish was ordered by mistake and was very expensive.  No manager wanted to take the charge off on their watch so it continued on in inventory for a few more years until the store finally closed. Sound familiar?

Our Storerooms must work with the concept of inventory turns in mind as well. Spare parts are a lot more expensive, but ones which fail to turn will disappoint our expectations because seals will dry rot, shafts are no longer round, lubricants have broken down, etc.  And no one wants to create a situation like that swordfish story.  Right?

There are other spare parts inventory key performance measures to include, but if not monitored for action to be taken, it really won’t matter.  Inventory turns is at the top of the list and knowing where your inventory compares to the industry average is an indicator for benchmarking.  What has been done may be okay, but this is a great opportunity to move from “okay” to “great”.

 

December 13, 2013

Treat Critical Spare Parts Differently

One reason to spend the time on the critical spares parts definition and processes is because these spare parts are much different than the rest of the MRO spare parts.  Therefore, defining them is one part of the solution and the other part is to define how to treat them differently.  Here are my top five suggestions to get started:

  •  Count critical spares more frequently – since these parts are more critical than the other spare parts, it is especially important the balance in the CMMS (computerized maintenance management system) system reflect the actual amount available.  I recommend counting weekly prior to the start of the purchase process.  Without the correct balance on-hand, an immediate action plan is required to obtain the correct stock level and change the on-hand balance in the CMMS system.  Additionally, if the critical spares are not 100% intact (not broken), then the broken part should be removed, the balance changed, and action taken to replace the broken critical spare.
  • Purchase first – again, since these parts are more critical than the others, it is important the critical spares are purchased first.  To facilitate the purchase process, the critical spares should be given their own re-order group and reviewed first.
  • Prioritize it – whenever the last one is taken from the drawer or shelf, make it a big deal because after all it is!  The team (storeroom attendants, planners, key mechanics, maintenance managers, etc.) should know the out-of-stock situation exists and action is being taken to replace the critical spare.  Once it becomes permissible to have a critical spare missing from inventory, it will no longer retain the same status and thus the scene is set for a catastrophic failure for the operation.
  • Mark it differently – it may make sense for the team to have a special colored tag for the critical spares for highlighted visual impact.  Additionally, it may make sense to organize and store the critical spares away from the other spare parts.  Certainly, in any CMMS system the critical spare should have a specific category to its own which can be filtered easily from the other spare parts.
  • Store it in a separate location – for the interest of distinction from the rest of the inventory the maintenance team may make decide to separate the Critical Spares from other MRO inventory items.  This may give the team an opportunity to give the extra focus to the Critical Spares and the separate location can help reinforce that.

Regardless of how you start to treat Critical Spare Parts differently from the rest of the MRO Spare Parts, it does tell the entire organization that these specific parts are considerably unique and important to the operation.  Once that importance is lost it is difficult to get the same type of focus and intensity around the Critical Spare Parts.  By keeping Critical Spare Parts at the forefront of everyone’s mind, the chances for significant downtime associated with them falls drastically.  Critical Spare Parts are an extra insurance policy to avoid catastrophic equipment failures – don’t leave them to chance! 

 

December 9, 2013

Critical Spare Parts – the Lifeblood of Equipment Reliability!

Electronics – Motors – Gearboxes – Cylinders – Bearings – Pneumatic components – Conveyor Belting – etc………… With all the spare parts in a MRO storeroom – how do you know what is a critical spare part to the Plant, facility, or operation?

That’s a tough question with an equally difficult answer – depends.  While that may seem superfluous to the question at hand, it really is the correct answer.  Each manufacturing Plant, facility, or organization is a little different in age, machinery, activity level, maintenance programs, and overall operator skill levels.  By definition, the critical spare parts are those spare parts which the organization must keep on-hand to minimize the potential risks of a catastrophic failure whether for safety, quality, prolonged downtime costs, etc.

I think back to a young Maintenance Manager new to his role.  The first week on the job he is handed a very large re-order report from his supervisor responsible for the storeroom.  The amount on the re-order report far exceeded his weekly budget.  After a couple of days scratching his head trying to determine what to buy first, he pulled together his team and asked the question of what to buy.  Each had a different answer because each had a different perspective and thought their key work was most important to the operation.

The process to determine what is a critical spare part can be very complicated with matrices and hours of analysis.  In most cases, when doing in-depth analysis most teams fail to make progress.  Many even fail to start.

In the beginning, I suggest a simple approach to get started and get a quick win with the critical spare parts process.  Later, the team can evolve to a more complicated analysis involving criticality of the equipment and risk of failure analysis.

One of the most effective means to begin to answer the critical spare part question is to gather a cross-section of the key players on the maintenance team – mechanics, storeroom (crib) attendants, managers, planners, and possibly the buyers.  This is clearly one of the key first steps to build an effective critical spare parts process.  After all, these are the folks who will make the process work day in and day out.

This team can start with defining what comprises a critical spare part and what makes it different from the rest of the inventory.  This is often noted as to its importance to the operation, lead time, limited vendor access, usage, etc. to determine that definition.  Sounds simple, but I have seen this conversation last over 2 hours before an initial consensus is reached. One key to remember – the team can redefine the “critical spare” anytime once more information or knowledge of the business details is available.  For example, if the local vendor is no longer in business and the previous easily obtainable spare part now has a longer lead time associated with it, then that definition may not have to include “long lead time” items.  In this case, lead time was not a criteria to consider before for critical spare parts, but now is a significant factor.

Another key to the first step – pick a number to designate as critical spares.  Usually 50 to 100 parts out of an inventory of 5,000 would be a great starting point.  Certainly starting with a smaller amount is a good first step to get alignment within the team and confidence in the process.  It can then let it evolve over time.  In some cases, this helps with the definition process because it boils down to “what are the spare parts which we can not afford to NOT have on-hand?

For help facilitating the Critical Spare Parts evaluation please contact us!

Next up…..how are we going to treat these parts differently from the rest of inventory?

 

December 6, 2013

MRO Spare Parts Journey – The 4 Keys to a Successful Venture

Asset Reliability programs require Manufacturing Plant maintenance and storerooms teams to routinely assess how they are doing (results) and what needs to be done.  Frankly, most organizations get stuck at that very spot – they don’t know what to do and the status quo ensues for long periods of time often marked with great frustration.
The central theme for today is to keep the approach simple so the organization can get started and gain some momentum.  Most physicists will tell you that the greatest force required to get an object moving (even one with wheels) is overcoming inertia.  However, once started the process gets a little easier and more speed is possible once things get rolling along.

When evaluating a MRO Spare Parts and equipment repair program it should be viewed as potentially the start to a journey and it, too, requires overcoming inertia.  The term journey means going from one spot to another with a road map of how to get to the destination.  Ensuring commitment to make the trip from all members of the team is a critical for success.  There are four key components to a MRO Spare Parts journey which need to be included.  Do these well and momentum can be gained quickly.

  • Core skill competencies – A great sports team can play with great enthusiasm, but without sufficient skills they will never be a winning team.  Same holds true for a maintenance and storeroom team.  Does the team have the knowledge to successfully reach the journey’s end?  Like a boot camp for the military recruits, certain basic information and skills are necessary to graduate to a level of excellence.  Inventory transactions, stock level setting, data integrity, Storeroom layout, technology understanding, CMMS record keeping, and inventory disposition are just a few of the core competencies requiring skill assessment.  Most teams are only as strong as the weakest team members so skill development is often an ongoing process.  However, many teams play to their individual members’ strengths for quick wins and success.  Few people are good at everything so why not let the team work on the areas where they do best?  This does not mean a team member should not know how to complete other key processes or tasks, but it suggests people are better at some portion of the job which their personal strengths and skill set show through.
  • Critical Processes – Does the team have the plays (processes) available to achieve success and does everyone know what they are?  Processes require a situation, people, technology and execution.  It is really that simple.  Take one of the elements out of the process and the result is not much to brag about.  Each of those elements can require different amounts of each component; however, they don’t go away.  For example, a check out log for a storeroom may require the situation of a part is needed by a single person along with a log sheet and a pencil to record the transaction.  While a pencil and paper process is not real technical, it meets the basics when executed consistently.  A watch out for many organizations is to identify unnecessary steps in processes such as copying papers which no one will ever use or need.  Keep it simple and repeatable as much as possible for ongoing success.  Continue to refine the process when more efficient methods are found.
  • Change plan – Great sports teams have a game plan going into a game and adjust to the plan as needed.  The same holds true with MRO Spare Parts, however, we call it a change plan.  This road map details how to reach the destination or goal.  It should focus on two initial elements – people and process.
    • “Who” is going to complete “what” and by “when”.  The “how” can describe the important tactic and may often require adjustments for success.  A change plan does not have to be difficult, but should focus on achieving the core competencies and work processes needed at the end destination.
    • Almost all people do not like change just for change sake. Change appeals to people when they are frustrated and their resistance to change is greatly reduced.  Focus on elimination of frustrating components of processes and removing barriers which get in the way.  This keeps people energized to make that journey.
    • However, if success is reached, NO one wants to go back to the old way and team frustration can be even worse than before.  Even leader credibility can erode with the team when this happens.  That is where the sustainability tactics come into the journey.
  • Sustainability tactics – As with sports teams, rebuilding and regrouping is difficult.  Once the destination has been reached, what is required to stay there?  Most people do not want to revisit the same activities over and over again.  So, what avoids falling backwards usually consists of performance measures as well as skill assessments along with a bench building strategy.  Great teams have a skilled team member available as needed to step in to fill the role when needed.  Additionally, how things are done (processes) is routinely evaluated for better ways.  That is how good teams remain that way – great people consistently executing great processes.

Again – make assessments and the journey simple with the key activities in place so future success is within grasp.  Avoid further frustration for the teams once the trip is started because of delays and cancellations.  Make a commitment to complete the journey and achieve greater success!

 

December 2, 2013

What is the purpose of MRO Spare Parts?

Okay, this seems like a simple subject, right?  MRO spare parts are for repairing equipment breakdowns or pending breakdowns.  But really, it’s a little more complicated than that.  When should something be kept on-hand and when should something be ordered just as needed?

Many inventory storerooms really struggle with this question and the answer depends on the processes established as well as commitment by the maintenance team.  If a maintenance team does a great job of predictive maintenance evaluations, then by all means many parts can be ordered as needed.  For locations caught in the fix it when it breaks mode, then time is generally not available to allow parts to be ordered with a sufficient lead time.

Once an organization addresses the question, then it really can come down to determining the purpose of the storeroom which is reflective of the maintenance processes.  Whether the purpose of the spare parts be for emergency repairs, long lead time parts, and high usage or all of those plus all the possible situations because of unpredictable breakdowns, it really gets down to the current status of the business for equipment reliability.

Sometimes the greatest obstacle for setting an initial storeroom purpose is getting the team together and agreeing on getting that discussion out in the open.  Once in the open, it can be relatively easy to find some common ground.  Once a first cut is made, then adjustments can be made to get a better reflection of the business as time goes on.  The key message is to keep talking and evaluating how the approach is working to effect the equipment reliability processes.

 

Get the Latest Newsletter Updates!

Enter your email address:

Contact Us

Chuck Watson
Senior Project Manager
(502) 817-1727
email: chuckwatson@thesblgroup.com

Steve Landis
Principal/MRO Specialist
(502) 648-8110
email: stevelandis@thesblgroup.com