Predictive MRO Inventory Management
The system is proprietary. The results are revolutionary.
The tighter your MRO inventory management, the smoother your overall MRO program – inventory control is the backbone of an efficient operation. Forecasting for MRO requires more than simple min/max ordering methods to account for the dynamic nature of your business. We’ve learned this from decades of MRO supply chain management, so we’ve developed a solution…
SDI’s own MRO inventory management system – SDiMS.
The SDI Inventory Management System (SDiMS) is a core component of our SDiExchange solution, developed expressly for MRO inventory, that combines technology, intellectual capital and management expertise to achieve optimum customer inventory levels while minimizing obsolete inventories. Translation: the lowest possible cost of ownership for MRO.
How our MRO inventory management works.
Using historical data on daily usage and transactions, we develop a replenishment forecast that identifies what items and quantities to order that will reduce total inventory, increase service levels, and lower transportation and receiving costs. Our statistical modeling system draws from 32 different algorithms to apply the best model (i.e. moving average, seasonal trend, low volume) to predict demand.
SDiMS by the numbers.
The results continue to impress. SDiMS drives inventories to optimal levels without affecting service levels. Using SDiMS, our clients have reduced inventories by 20-40% while increasing service levels to 98% or above. Smaller, more efficient inventories mean savings via reduced administration and carrying costs – while increased service levels mean improved productivity.
Future protection is built in.
In addition to lowering active inventory levels, SDI can reduce future build-ups. Our MRO inventory management system alerts inventory managers to opportunities for reducing excess build-up by quickly identifying parts that have significantly reduced usage, eliminating the growth of obsolete inventory. Plus, over-utilized parts are identified to enable a root cause analysis that will determine if a machine needs maintenance or an employee needs training to relieve the consumption.
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- Basic Materials
- Consumer Goods & Services
- Service Industry
It takes a progressive manager to push the organization to look at indirect spend and managing it in a different way - but once you see it, then you realize the opportunity.
In the third post in this series on MRO As-a-Service by Spend Matters, Pierre Mitchell and Michael Lamoureux talk about how managing MRO as a process delivers benefits from efficiency to effectiveness and beyond to an evolutionary phase. The next generation of value, MRO-as-a-Service, helps organizations build intelligent, agile, scalable and integrated supply chains (direct and indirect).
The project team has worked its way through Define, Measure, Analyze, and Improve. It’s time to begin the Control phase. The key stakeholders gather to evaluate the solution as implemented and create a plan to sustain the improvements. The goal is to standardize the improved processes, establish an audit schedule and schedule periodic follow-up to identify additional opportunities for improvement.