Inventory and spare parts management are among the biggest thorns in the side of operations managers in manufacturing.
Often seen as a “necessary evil,” spare parts inventory management is a task that largely flies under the radar when accomplished correctly, but creates major headaches when it is not. For that reason, the importance of maintaining spare parts in a sensible, efficient and practical way shouldn’t be overlooked — in spite of the thankless nature of the job.
A good spare parts management system can increase the productivity of your facility, reduce unplanned downtime and, most importantly, make a positive impact on your bottom line. Use these tips to develop or update your parts management plan — and make those “thankless” tasks a bit easier.
1. Spare Part Prioritization
You know better than anyone that not every spare part has the same level of criticality for your operations, so you’re also the best judge of how to prioritize potential spare part needs. Creating a priority list can very quickly make your spare parts inventory management tasks much more efficient, as well as more effective. Many factors can go into this list, beyond the obvious consideration of which equipment is most critical to your operation.
Lead times, downtime implications and other concerns also play a role as you work out which spares are most critical to keep on hand, and in what quantities. Having a reference list makes ordering and stocking decisions much easier, as it will become clear which parts you’ll want to stock in quantity and which can be stocked in lower numbers, or ordered as needed (depending on your specific needs).
2. Create a Comprehensive Lead Time Resource
Lead time for spare part fulfillment is one of the biggest reasons for extended downtime when a machine or component fails. Even a few hours of downtime can wreak havoc on your production schedule. A lead time reference can go hand in hand with your priority list and can play a role in how you assign that priority.
Access to a local supplier who can reliably get you spare parts on demand, for instance, can change your consideration as to how much inventory you need to keep on hand for those parts. Longer lead times for more critical components mean that you’ll want to be more proactive about planning ahead, should those parts be needed.
3. Leverage Data
Unplanned downtime and reactive maintenance are productivity destroyers for your facility. Predictive maintenance practices can make things easier for you to be proactive and make more informed decisions about what inventory to keep on hand. Data sensors and monitors can help you understand which equipment is more likely to need maintenance or replacement parts in the near future, making ordering decisions less of a guessing game and more of a data-backed methodology.
4. Factor in New Machinery Parts
New equipment is just as subject to the need for replacement parts as older equipment is — and new equipment downtime is likely to be even more damaging to your production schedule, since you were likely planning to put that new machine to work right away. Be sure to account for spares for new equipment as part of your spare parts management system. As you prioritize inventory management and plan your ordering, be prepared to address the “growing pains” that can occur.
5. Implement Security Measures
Spare parts inventory control and security should be integrated with your parts management plan. Open, uncontrolled access to inventory is a key driver of missing parts, inaccurate inventory counts and availability shortages. A key element of a spare parts inventory control system is introducing a “parts counter” — a single, controlled point of access to the inventory room.
By only allowing access to personnel working the parts counter, you can have much more control over inventory that enters and exits the room, and will likely see accuracy metrics improve as a result. Additional factors in inventory security are badges or keycards to control access, as well as cameras to help ensure that access to inventory is never compromised.
6. Optimize bill of materials (BOM)
In maintenance parts inventory management, the bill of materials (BOM) is a comprehensive reference of everything needed to produce a part, product, or component: materials, tools, spare parts and so on. The BOM is a key point of reference for maintenance and repairs and should be optimized to ensure that these processes can be carried out as quickly and efficiently as possible whenever they are scheduled or otherwise required. An optimized BOM is structured and categorized and should also include a process and schedule for monitoring and replenishing spare part levels as needed. This helps to reduce time identifying and locating the correct spare parts for a repair and should ideally eliminate maintenance delays due to emergency part orders.
7. Create a standard process
Managing spare parts inventory is a complex task that requires high levels of organization. One of the most effective ways to achieve the necessary level of organization is to implement a standardized process that all workers involved in maintenance tasks adhere to. The most common method is a work order process, whereby every repair or maintenance task is documented in a ticket that includes the necessary parts that will be taken out of inventory. This process helps to track inventory levels and aids in ordering and forecasting, and is today made easier and more efficient through digitization and automation.
8. Make spare parts accessible
While maintenance and repair operations are critical to the ongoing effectiveness of production, they are not considered tasks that directly create value — and thus, they should be carried out as quickly as possible. Time spent locating spare parts or seeking access to the storeroom is time not spent carrying out the tasks that get equipment back up and running in optimal shape. Employees should be able to easily access inventory information and spare parts locations, and they should be able to efficiently access the area in which spares are kept.
9. Utilize a CMMS
A CMMS (computerized maintenance management system) helps you leverage the technology implemented throughout the facility (such as industrial sensors) to organize, plan and carry out maintenance processes as efficiently and cost-effectively as possible. A CMMS centralizes key maintenance data in one location, accessible by anyone relevant to the maintenance function, including technicians, managers and stakeholders. With this single source of truth, everyone involved is working from the same set of data, and information is kept up to date in real time.
10. Invest in automation
In maintenance inventory management, automation helps technicians to carry out tasks like those described above — work orders, inventory tracking and check-out, maintenance results and more — consistently, efficiently and effectively. Human error is the leading culprit behind missed reports and work orders, which can lead to inventory discrepancies, maintenance delays and cost overruns. Automation systems like distribution automation, in this context, do not replace human workers — they help them to carry out the “administrative” components of the job more effectively while letting them focus on their core area of expertise: maintenance.
Consider the Overall Value of Spare Parts Management
It’s worth repeating, spare parts management is often a thankless task — but when you consider the lost revenue and logistical nightmares extended downtime can present, it’s much easier to get motivated to implement this “necessary evil.” A few hundred dollars worth of inventory can prevent thousands — or more — in lost or delayed revenue that can come as the result of unplanned downtime.
If you need to justify the resource expenditure for a comprehensive management plan to the organization — or to yourself — you probably won’t need to look much further than using any recent downtime event as an illustration. With these six tips in mind, it is our hope that inventory management will become a bit less of a burden for you, and much more of a value driver.