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The Inventory Management System’s Role in Supply Chain Integration Strategy

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With manufacturers working on thinner and thinner margins, maintenance, repair, and operations materials managers find themselves under greater scrutiny. Under pressure to keep inventory costs to a minimum while maximizing production uptime, forces them to walk a fine line. They must eliminate mistakes that would have them overspend on excess components and carrying costs as well as the potentially more devastating errors of neglecting to keep a critical spare part on hand when a failure occurs. Keeping these types of oversights at bay necessitates sophisticated identifying, prioritizing, classifying, and tracking how parts travel through the organization’s value chain. Accomplishing these tasks efficiently starts with clean, accurate data and an integrated system for accessing and acting on it.

Data Integrity

MRO that is consistently formatted, free of duplication and errors, and reflective of the company’s true reality is key to optimal MRO asset utilization and cost control. Data provides the raw material for forecasting, usage estimating, and maintenance scheduling, all important considerations for MRO supply chain integration strategies. Manipulating strong data with an inventory management system (IMS) and computerized maintenance management system (CMMS) makes assets more visible, their movement more transparent, and their use more purposeful. To take full advantage of these inventory tools, companies should integrate their IMS and CMMS systems. Combining the insights they produce, manufacturing firms can formulate comprehensive strategies and automate many of the routine tasks involved in obtaining and using machine parts, cleaning materials, consumables, and other items involved in the manufacturing process. To understand the importance of IMS and CMMS integration, it may be helpful to understand the benefits each brings to companies.

Inventory Management Systems

An IMS provides a window into MRO assets’ lifecycle. The system keeps track of stock items identified with barcodes or RFID tags. As they are consumed, the platform deducts them from the inventory list. Companies can access real-time data on stock levels and inventory values to identify potential waste, trigger reorder points, and stratify parts based on criticality, lead time, carrying cost, and other factors.

Computerized Maintenance Management System

CMMS connects inventory with the people who use it – maintenance teams, operations, compliance, and quality assurance, etc. The software hosts databases that generate dashboards and reports that inform decisions as to which personnel, equipment, material, and timeframes will yield the most efficient maintenance operations. CMMS also can coordinate preventative maintenance, dispatch teams across multiple locations, order replacement items, and generate work orders. CMMS incorporate LIFO, FIFO, JIT, and moving-average inventory accounting and tracking.

The Supply Chain Integration Process

Integrating inventory, maintenance, and business operations data through IMS and CMMS platforms creates a holistic view of your company’s competitive position and workflow efficiency. With a single, complete supply chain integration program, you need maintain only one data lake and you can format SKU information – size, quantity, price, location, supplier, catalog number, etc. correctly as each shipment arrives or order is made. A common receptacle of data makes information exchange simpler, with less risk of mistakes or need for manual intervention. It creates a more pleasant user interface, making workers more efficient. And it moves MRO maintenance, supply chain management, and inventory control from the reactive to the proactive. You will see a decrease in catastrophic failures and stockouts because an effective supply chain integration strategy utilizes tools will allow for more predictive maintenance, automate reorders, and create opportunities for intelligent equipment monitoring.

SDI can help you implement supply chain integration strategies that yield real cost savings and productivity gains through a variety of features:

  • Comprehensive inventory records – SDI’s supply chain integration process links IMS and CMMS to ensure mission-critical spare parts are always available and consumables are maintained at optimal levels.
  • Asset location and relationships to other components – Simple taxonomy eliminates multiple SKUs for identical parts, which can cause wasteful order duplication. We can show how to kit out parts for common applications and ensure preassembly of components when feasible.
  • Part failure frequency – Determining the average usage of key parts, their expected lifespan, and their time to replace enables more precise maintenance scheduling and less downtime.
  • Automatic MRO inventory count updates – Tracking stock usage and plant location digitally saves time on manual checks.
  • Reorder point notifications and automation – Accurate, accessible data creates more precise min/max parameters and establishes optimal reorder points and quantities based on delivery lead-time.
  • Inventory cost tracking – Detailed invoice and purchase order reconciliation quantifies maintenance-related activities and establishes their cost centers and impact on financial for each job performed. Better forecasting will result.
  • Inventory-focused maintenance reports – Reports founded in inventory and maintenance management costs highlights trends you can exploit to better allocate resources, automate ordering, and schedule equipment maintenance.

Contact SDI’s helpful sales team for a demonstration of our MRO supply chain integration offerings.

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