Companies in mature regions like North America and Western Europe from various industries such as pharmaceutical, automotive, CPG, aerospace, food & beverage tend to follow end-to-end MRO (maintenance, repair, and operating supply) spare part management. Many of them now outsource end-to-end inventory management processes to MRO integrators. However, for those who do not, inventory management in the MRO category remains a big challenge.
"Every manufacturing plant function must follow a cross-functional approach that can create synergies and deliver objectives of Inventory Management, ensuring optimum plant reliability and productivity. A responsibility matrix defining the correct function for MRO spare parts management and inventory optimization is the need of the hour; many top companies from multiple industries are steadily moving toward that goal," said Vijith Bhargavan, Senior Domain Analyst at Beroe. "With Inventory Management becoming a key opportunity for achieving cost savings, cost avoidance, and other objectives, it becomes a significant focal point for building an overall strategy; but for implementation, it is important to comprehend a holistic MRO plant structure."
The major challenge in Inventory Management in the MRO category is demand forecasting. It is a complex process even for product-based enterprises, especially in the MRO companies where demand for spares and consumables is completely erratic, which makes it even difficult to forecast consumption on an accurate basis. But accuracy in forecasting becomes the major avenue for the improvement in MRO inventory. Since the MRO landscape is becoming competitive by the day, reduced working capital and investment become the need of the hour.
The next big challenge is to identify the function of ownership and accountability of the MRO Inventory Management process. Taking absolute care of this process is a tedious task as one needs to have a clearer idea of the critical spare parts and on-site availability. Special care needs to be given to ensure there is a minimum halt to the production line as it may cause a loss of market share and customer goodwill. One should be able to determine accurate MRO budgets and create smart processes and FTEs for managing MRO spare part inventory.
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