Supply Chain Management: Storehouse & MRO Management

Today, more than ever, there is a burning need to increase asset performance while reducing costs. This is not a new concept, as typical assets undergo between 30 and 50 reliability, maintenance and production optimization initiatives each year. These initiatives are successful when there is a shift from the conventional “repair and modification” approaches to a focus on “consequence mitigation.”

Supporting a Reliability Culture value proposition, research has been undertaken by the insurance industry on causes of industrial insurance claims. The research found that fifty percent of reported losses could have been avoided or reduced with the appropriate plant-condition monitoring systems and practices. Thirty percent could have been reduced by the application of a simple plant inspection process, and six percent by appropriate training.

Storeroom Operations Facts

Critical to the implementation of a Reliability Culture is the Storeroom Operation. Storeroom Operation ensures the right parts are available at the right time, with regards to the right quantity and quality. Too many storeroom operations have become the dumping grounds for excess inventory, leftover project work, and anything else to keep “just in case.”

Consider some of these findings:

  • 5% - 12% of a typical storeroom inventory consists of duplicate parts
  • 58% of the inventory has not been touched in more than three years
  • 60% of active inventory min/max levels are in excess of maximum levels
  • 15% - 35% of stocked items are considered obsolete
  • Top 6% of stocked items account for more than 80% of daily activity
  • Less than 24% of companies surveyed trust inventory data
  • 18% of a technician’s time is spent looking for parts
  • 24% - 26% of a technician’s time is used walking to and from job sites looking for additional parts

Operations & Supply Chain Management Consulting & Training Solutions

At Nexus Global Business Solutions, Inc., we have a number of custom-designed training sessions available that discuss, in great detail, the 15 tactical processes and nine strategic practices that go into effective supply chain management, as well as storeroom optimization (including 5S) and process development.

These tactical processes include such value streams as receiving, issuing, cycle counting, and new item setup. Strategic practices include areas such as data scrubbing, CMMS utilization, obsolescence program, stocking levels, etc. Optimization of operations reviews the storeroom layout, 5S principles, and technology (bar-coding, RFID).

This hands-on, practical training is designed for the attendee to fully understand what constitutes a world-class storeroom operation and its importance to the overall corporate strategy. Nexus Global has designed this training to be educational, informative and fun.  

What to Expect From Your Supply Chain Management Training

Nexus Global Maintenance Repairs and Operations (MRO) solutions include assessing, training, and on-site coaching to establish both an effective and efficient storeroom operation. The main objective is to establish optimum inventory levels through proper procurement and materials management, incorporating effective analysis, implementation, procedures, and controls that ensure sustainability in the maintenance excellence program. Our goal is to help you turn your storeroom into a profit center.

Included in the training are tools that may be used immediately to help turn storeroom cost centers into profit centers.

The most powerful tool included is the “Silver Bullet,” which helps to determine exactly what should be stored in the stockroom and at what levels, as well as what is overstocked and understocked. Other features include an overview of storeroom best practices, an on-site tour to better familiarize and customize the training session, and involving enough in-house resources in the education and review process to bring about a positive cultural change.

Storeroom Systems Improvement Support

Nexus Global utilizes an assessment report that reviews, in detail, six specific areas of a storeroom operation: Staffing, Inventory Control, Materials Handling, Storeroom Layout, Procurement, and CMMS.

  • Best layout – Current storeroom layout practices will be reviewed and best practice recommendations presented to leadership — those that can be quickly adapted will be incorporated in the project immediately and other suggestions submitted for implementation approval.
  • Parts naming nomenclature – Current naming conventions will be compared to industry and international naming conventions to determine best fit practices.
  • Obsolete inventory practice – Practices for eliminating obsolete inventory on an immediate and ongoing basis will be reviewed and improvement recommendations suggested.
  • Metrics development – We will review the current metrics and recommend metrics improvements to close gaps and allow tracking of the most value-added KPIs.
  • Security – Current security practices will be reviewed and revised to improve security.
  • Planning – A plan for improvement in all the above systems and continuation of inventory improvement will be developed, and consensus developed for actions and steps.
  • Review of min/max levels, stocking levels, critical spares, and part classifications

Contact Our Supply Chain Management & MRO Consultants

To get in touch with the team at Nexus Global Business Solutions about our supply chain and operations management consulting solutions, please contact one of our offices today. We have a number of locations in the U.S., Canada, South America, Africa, Asia and the Middle East.