Maintenance, Repair and Operations, consists of all pieces of equipment that organizations use to produce end-products. MRO costs can be very high if a machine falters, because it also leads to downtime. On the other hand, many tail-end parts are replaceable and can be standardized with better alternatives.
Having the right spare parts at the right time is critical for production processes. MRO purchasing is normally a painful and labour-intensive procedure. However, manufacturers can take matters in their own hands by taking control of their MRO data. Achieve substantial savings, and reduce complexity by taking lead of your own supply chain.
If you want to learn more about MRO, you can download our (free) whitepaper on the topic.
Read our Success Story for MAG45, an industrial integrator that facilitates the movement of more than 1.5 million items from several thousand suppliers.
In manufacturing companies, there are three departments which are directly affected by MRO-related problems – Purchasing/Procurement, Supply Chain, and Operations. In an increasingly complex environment, in which the role of these departments continues to expand and evolve, the challenges they are facing increase accordingly.
Purchasing/Procurement departments must navigate long supply chains with several points of contact, which increases the chance of things going wrong. Often, with proper control and overview, these problems can be avoided but because there are so many stakeholders involved, it becomes complicated. Reducing unnecessary or accidental orders, optimizing the number of purchases, finding cheaper alternatives to expensive products, and improving efficiency are the main challenges handled daily by this department.
Furthermore, finding high-quality suppliers which fit the budget of the organization is difficult. These issues are compounded by the fact that data is not always accurate. Procurement is becoming more automated but not standardized. This means companies in the same supply chain can have a very different vision on how data should be handled.
Effective supply chain management allows organizations to track the movement of raw materials needed to create products. Conversely, ineffective management can lead to high costs, excess inventory or machine downtime. That’s why the main challenges of Supply Chain departments are how to optimize spare-part stock levels, standardization of parts, and dealing with the overwhelming amounts of data coming from stakeholders. In today’s constantly changing environment, organizations that are best able to control and track their inventories will have an enormous advantage over their competitors.
Finally, Operations & Maintenance departments have the stressful task of making sure everything works properly. Their biggest challenge is risk management. Pinpointing areas of high risk, such as machine or system failure that can cause downtime or outage of production is their most vital job. Their work obviously overlaps with the Supply Chain department when having to decide on which supplier they should depend on for emergencies and locating risky areas where there aren’t many supplies that can be contacted in case of emergency. Another issue they must handle is deciding when a machine has depreciated enough to be replaced. What is the best moment for a switch and how much will it cost? Increasing sophistication and complexity of machines as well as finding qualified people that can operate them is another very energy-consuming challenge for Operations.
In our experience, all three departments experience problems with MRO. Also, there are a lot of areas with overlap. Unfortunately, in most companies, these departments don’t work closely together. Sometimes communication is lacking and sometimes it’s simply not taking place because the teams are in different physical locations. In this case, effective collaboration often ends up being the biggest challenge of them all.